**Exhibit 10.1**

**ASSET PURCHASE AGREEMENT**

ThisASSET PURCHASE AGREEMENT (the “Agreement”) is made as of October 27,2006, by and between DynTek, Inc., a Delaware corporation (“Parent”),DynTek Canada Inc., an Ontario corporation and wholly owned subsidiary of Parent(“Buyer”), Sensible Security Solutions Inc., an Ontario corporation (“Seller”),3849597 Canada Inc., a Canadian corporation (the “Shareholder”) and PaulSaucier, a natural person who is the President of Seller and who ownsindirectly all of the issued and outstanding common shares of Seller (the “PrincipalOwner” and collectively with the Shareholder, the “Principal Owners”).  Capitalized terms used herein and not definedherein are defined in Exhibit A attached hereto.

**R E C I T A L S**

WHEREAS, Seller isengaged in the business of providing information technology service offeringsincluding, among other things, hardware and software management andintegration, network and custom software design, project management andconsulting services (the “Business”);

WHEREAS, Buyer desires topurchase and Seller desires to sell to Buyer substantially all of the assets ofthe Business, subject to the terms and conditions of this Agreement; and

WHEREAS, the Board ofDirectors of Parent and Buyer, in accordance with the laws of their respectivejurisdictions of organization and their respective charter documents, and theBoard of Directors and the sole shareholder of Seller, in accordance with thelaws of the Province of Ontario and Seller’s constating documents, haveapproved this Agreement upon the terms and subject to the conditions set forthin this Agreement.

**A G R E E M E N T**

NOW, THEREFORE, inconsideration of the terms, covenants, and conditions hereinafter set forth,the parties hereto agree as follows:

# **ARTICLE I**

# **PURCHASE OF ASSETS; ASSUMPTION OF LIABILITIES**

## **1.1****          Purchased Assets.**  Subject to the terms and conditions of thisAgreement, Buyer hereby agrees to purchase from Seller, and Seller herebyagrees to sell, convey, transfer and assign to Buyer, on the Closing Date (ashereinafter defined), all of Seller’s right, title and interest in and to theassets of Seller used in connection with the Business, other than the ExcludedAssets (collectively, the “Purchased Assets”), free and clear of any andall Encumbrances, except for the Permitted Encumbrances (as hereinafterdefined) set forth on Schedule 1.1 and other than the restrictions onthe transfer of the Assigned Contracts. The Purchased Assets shall include, but shall not be limited to, thefollowing:

----

## (a)           All of Seller’s rightsand obligations under all of the agreements of the Seller relating to theBusiness, all of which are identified on Schedule 1.1(a) attached hereto(collectively the “Assigned Contracts”);

### (b)           All of Seller’saccounts or notes receivable from and including October 1, 2006, and all cashand cash equivalents, related to the Business, all of which are identified on Schedule1.1(b) attached hereto and all schedules, records and other documentationrelated to such accounts or notes receivable, and cash or cash equivalents;

### (c)           All of Seller’ssupplies, computers, equipment, furniture and fixtures, and all other tangiblepersonal property owned by Seller and used in connection with the conduct ofthe Business, all of which, to the extent each individual asset has anundepreciated value in excess of Two Thousand Five Hundred Dollars ($2,500),shall be identified in the fixed asset schedule to be attached hereto as Schedule1.1(c) (the “Fixed Assets”);

### (d)           All of Seller’s booksand records directly related to, or used in connection with, the conduct of theBusiness or pertaining to the Purchased Assets, regardless of the medium onwhich such information is stored or maintained including, without limitation,all customer and employment records, vendor information and contracts, businessplans and strategies, financial and operational data and reports, and marketinginformation and materials;

### (e)           To the extenttransferable, all of Seller’s licenses, permits or other authorizations ofgovernmental or regulatory entities that are required under any laws, rules andregulations applicable to or affecting the Business, all of which are set forthon Schedule 1.1(e);

### (f)            All of Seller’s ownedand leased real property, including any leasehold improvements thereon, all ofwhich are identified in the real property schedule attached hereto as Schedule 1.1(f);

### (g)           All of Seller’sinventory, a detailed list of which shall be set forth on Schedule 1.1(g);

### (h)           All of Seller’sIntellectual Property Rights which are set forth on Schedule 1.1(h);

### (i)            All insurancebenefits, including rights and proceeds, arising from or relating to thePurchased Assets or the Assumed Obligations (as defined herein);

### (j)             All advance payments,claims for refunds, deposits and other prepaid items as of the Closing Date;

### (k)           All of Seller’s claims,including claims against third parties, relating to the Purchased Assets,whether choate or inchoate, known or unknown, contingent or ascertained; and

### (l)            The goodwillassociated with the Purchased Assets and the Business.

## **1.2****          Excluded Assets.**  The Purchased Assets being purchased by Buyerhereunder shall include all of the assets of Seller with the exception of theparticular assets set forth on Schedule 1.2, which assets shall beretained by Seller (collectively, the “Excluded Assets”).

----

## **1.3****          Assumed Obligations.**  Buyer hereby agrees to assume only thoseobligations at the Closing and effective as of the Effective Time, and agreesto pay, perform and discharge only those liabilities and obligations accruingdue and relating to the period subsequent to the Effective Time under theAssigned Contracts and the accounts payable specifically identified on Schedule 1.3(collectively, the “Assumed Obligations”).  The Assumed Obligations shall only include thoseobligations or liabilities arising out of any default under any AssumedObligation that occurs subsequent to the Effective Time, and Buyer shall not beobligated to assume any Assumed Obligation which is in default prior to theClosing Date, or which default arises from the operations of Seller prior tothe Effective Time, unless otherwise expressly provided for in this Agreement.

## **1.4****          Liabilities Not BeingAssumed.**  Except for the AssumedObligations, Seller agrees that Buyer shall not be obligated to assume orperform, and is not assuming or performing, any liabilities or obligations ofSeller, whether known or unknown, fixed or contingent, certain or uncertain,and regardless of when such liabilities or obligations may arise or may havearisen or when they are or were asserted (the “Retained Liabilities”),and Seller shall remain responsible for all Retained Liabilities, which shallinclude, without limitation, any and all of the following obligations orliabilities of Seller:

### (a)           Any compensation or benefitspayable to present or past employees of Seller arising in connection with theiremployment by Seller, including without limitation, any liabilities arisingunder the *Employment Standards*Act(Ontario), any employee pension or profit sharing plan or other employeebenefit plan and any of Seller’s obligations for vacation, holiday or sick pay,any obligations under any employment, consulting or non-competition agreementto which Seller is a party, whether written or oral, and any liabilities orobligations arising out of the termination by Seller of any of its employees inanticipation or as a consequence of, or following, consummation of thetransactions contemplated hereby;

### (b)           All federal,provincial, local, foreign or other taxes (i) that have arisen prior to theClosing Date or may arise thereafter out of business or other operationsconducted by Seller either prior to or after the Closing Date, or (ii) forwhich Seller is or, at any time hereafter, may become liable; provided,however, that the Retained Liabilities shall not include any taxes arising outof the conduct by Buyer, on or after the Closing Date, of the Business, or theownership, on or after the Closing Date, of the Purchased Assets;

### (c)           All Encumbrances exceptfor the Permitted Encumbrances on any of the Purchased Assets and allobligations and liabilities secured thereby that are not Assumed Obligations;

### (d)           All accounts or notespayable obligations for borrowed money, all purchase money obligations and anyother indebtedness or payment obligations of Seller, other than thosespecifically identified on Schedule 1.3; and

### (e)           Any claims, demands,actions, suits or legal proceedings that have been asserted or threatened priorto the Closing Date against Seller, the Business or the Purchased Assets orwhich may be asserted or threatened hereafter against the Purchased Assets, theBusiness or Buyer that arise in any way from or in connection with Seller’soperation of the Business prior to the Closing Date.

----

# **ARTICLE II**

# **CONSIDERATION FOR PURCHASED ASSETS**

## **2.1****          Purchase Price.**  As consideration for (i) the sale to Buyer ofthe Purchased Assets, and (ii) the assumption of the Assumed Liabilities, Buyershall pay Seller the “Closing Consideration” set forth inSection 2.2 below and the “EBITDA Earn-Out Consideration” set forthin Section 2.3 below (collectively, the “Purchase Price”).

## **2.2****          Closing Consideration.**  On the Closing Date, Buyer shall pay toSeller each of the following:

### (a)           A cash payment of OneMillion Two Hundred Thousand Dollars ($1,200,000), which shall be adjusted inaccordance with Section 2.7 and reduced by the amount used by Buyer to pay offthe Secured Obligations (as defined below) as set forth in Section 8.8 (the “CashConsideration”).  The CashConsideration shall be sent by wire transfer of immediately available funds toan account designated by Seller.

### (b)           A payment of suchnumber of shares of Parent’s common stock (the “Common Stock”) equal toThree Hundred Thousand Dollars ($300,000) divided by the Average Per SharePrice.  For purposes of thisSection 2.2 only, the “Average Per Share Price” means the averageof the closing prices per share of the Common Stock as reported on theOver-the-Counter Bulletin Board (“OTC”) during the fifteen (15) tradingdays preceding the Closing Date, provided, however, that in no event shall theAverage Per Share Price be less than Fifteen Cents ($0.15) or more than TwentyFive Cents ($0.25).

## **2.3****          EBITDAEarn-Out Consideration. **In additionto the payments to be made to Seller pursuant to Section 2.2 above, on theterms and subject to the conditions of this Section 2.3, Seller shall beentitled to receive certain additional payments (each an “EBITDA Earn-OutPayment” and collectively the “EBITDA Earn-Out Payments”) contingentupon the achievement of specified EBITDA (as hereinafter defined) targets asmore fully described herein.

### (a)           For the period fromOctober 1, 2006 through December 31, 2006 (the “First Quarter”),Buyer shall pay to Seller $1,000,000;

#### (i)            minus the differencebetween: (A) $1,000,000; and (B) EBITDA earned by the combinedoperation of the Purchased Assets and Buyer’s operations in Canada(collectively the “Canadian Business”) during the First Quarter (“FirstQuarter EBITDA”); and

#### (ii)           minus: (A) if FirstQuarter EBITDA earned by the Canadian Business is less than $125,000, the fullamount of the First Quarter EBITDA earned by the Canadian Business; (B) ifFirst Quarter EBITDA earned by the Canadian Business is greater than $125,000and less than $250,000, $1.00 for each dollar that First Quarter EBITDA earnedby the Canadian Business is less than $250,000 (not to exceed $125,000); or(C) if First Quarter EBITDA earned by the Canadian Business is equal to orgreater than $250,000 then by zero dollars.

----

#### (iii)          The consideration to bepaid, if any, pursuant to this Section 2.3(a) shall be referred to as the “FirstQuarter EBITDA Consideration.”

### (b)           For the period fromOctober 1, 2006 through March 31, 2007 (the “Second Quarter”), Buyershall pay to Seller $2,000,000;

#### (i)            minus the differencebetween: (A) $2,000,000; and (B) EBITDA earned by the Canadian Business duringthe Second Quarter (“Second Quarter EBITDA”);

#### (ii)           minus: (A) if SecondQuarter EBITDA earned by the Canadian Business is less than $250,000, the fullamount of the Second Quarter EBITDA earned by the Canadian Business; (B) ifSecond Quarter EBITDA earned by the Canadian Business is greater than $250,000and less than $500,000, $1.00 for each dollar that Second Quarter EBITDA earnedby the Canadian Business is less than $500,000 (not to exceed $250,000); or (C)if Second Quarter EBITDA earned by the Canadian Business is equal to or greaterthan $500,000 then by zero dollars; and

#### (iii)          minus the First QuarterEBITDA Consideration

#### (iv)          The consideration to bepaid, if any, pursuant to this Section 2.3(b) shall be referred to as the “SecondQuarter EBITDA Consideration.

### (c)           For the period fromOctober 1, 2006 through June 30, 2007 (the “Third Quarter”),Buyer shall pay to Seller $3,000,000;

#### (i)            minus the differencebetween: (A) $3,000,000; and (B) EBITDA earned by the CanadianBusiness during the Third Quarter (“Third Quarter EBITDA”);

#### (ii)           minus: (A) ifThird Quarter EBITDA earned by the Canadian Business is less than $375,000, thefull amount of the Third Quarter EBITDA earned by the Canadian Business;(B) if Third Quarter EBITDA earned by the Canadian Business is greaterthan $375,000 and less than $750,000, $1.00 for each dollar that Third QuarterEBITDA earned by the Canadian Business is less than $750,000 (not to exceed$375,000); or (C) if Third Quarter EBITDA earned by the Canadian Businessis equal to or greater than $750,000 then by zero dollars; and

#### (iii)          minus the aggregate of the First Quarter EBITDAConsideration and the Second Quarter EBITDA Consideration.

#### (iv)          The consideration to bepaid, if any, pursuant to this Section 2.3(c) shall be referred to as the “ThirdQuarter EBITDA Consideration.”

### (d)           For the period fromOctober 1, 2006 through September 30, 2007 (the “Fourth Quarter”),Buyer shall pay to Seller $4,000,000;

#### (i)            minus the differencebetween: (A) $4,000,000; and (B) EBITDA earned by the CanadianBusiness during the Fourth Quarter (“Fourth Quarter EBITDA”); and

----

#### (ii)           minus: (A) if FourthQuarter EBITDA earned by the Canadian Business is less than $500,000, the fullamount of the Fourth Quarter EBITDA earned by the Canadian Business;(B) if Fourth Quarter EBITDA earned by the Canadian Business is greaterthan $500,000 and less than $1,000,000, $1.00 for each dollar that FourthQuarter EBITDA earned by the Canadian Business is less than $1,000,000 (not toexceed $500,000); or (C) if Fourth Quarter EBITDA earned by the CanadianBusiness is equal to or greater than $1,000,000 then by zero dollars.

#### (iii)          minus the aggregate of the First Quarter EBITDAConsideration, the Second Quarter EBITDA Consideration and the Third QuarterEBITDA Consideration

#### (iv)          The consideration to bepaid, if any, pursuant to this Section 2.3(d) shall be referred to as the “FourthQuarter EBITDA Consideration.”

#### (v)           In the event that the Fourth Quarter EBITDA Considerationis a positive number, the Seller shall receive such amount in accordance withSection 2.5 below.  In the event that theFourth Quarter EBITDA Consideration is a negative number, the Seller shall beobligated to repay to Buyer the absolute value of such amount (the “RepaymentObligation”) within ten (10) days of the date on which the Final EBITDADetermination (as defined below) is made with respect to the Fourth QuarterEBITDA Consideration.  Seller may electto satisfy the Repayment Obligation by delivery of cash to Seller or deliveryof Earn-Out Shares, as defined below, pursuant to Section 2.5(c).  In no event shall the amount of the RepaymentObligation exceed the value of the Earn-Out Shares issued to the Seller in theFirst Quarter, Second Quarter and Third Quarter and once the Earn-Out Sharesfrom such periods have been extinguished in order to satisfy all or part of theRepayment Obligation, the Buyer and Parent acknowledge and agree that theyshall have no further recourse to the Repayment Obligation from the Seller andthe Principal Owners.

### (e)           For the period fromOctober 1, 2007 through September 30, 2008 (the “Second Year”),Buyer shall pay to Seller $5,000,000;

#### (i)            minus the differencebetween: (A) $5,000,000; and (B) EBITDA earned by the CanadianBusiness during the Second Year (“Second Year EBITDA”); and

#### (ii)           minus: (A) ifSecond Year EBITDA earned by the Canadian Business is less than $750,000, thefull amount of the Second Year EBITDA earned by the Canadian Business;(B) if Second Year EBITDA earned by the Canadian Business is greater than$750,000 and less than $1,250,000, $1.00 for each dollar that Second YearEBITDA earned by the Canadian Business is less than $1,250,000 (not to exceed$500,000); or (C) if Second Year EBITDA earned by the Canadian Business isequal to or greater than $1,250,000 then by zero dollars.

#### (iii)          The consideration to bepaid, if any, pursuant to this Section 2.3(e) shall be referred to as the “SecondYear EBITDA Consideration.”

### (f)            For the period fromOctober 1, 2008 through September 30, 2009 (the “Third Year”),Buyer shall pay to Seller $10,000,000;

----

#### (i)            minus the differencebetween: (A) $10,000,000; and (B) EBITDA earned by the CanadianBusiness during the Third Year (“Third Year EBITDA”); and

#### (ii)           minus: (A) ifThird Year EBITDA earned by the Canadian Business is less than $1,125,000, thefull amount of the Third Year EBITDA earned by the Canadian Business;(B) if Third Year EBITDA earned by the Canadian Business is greater than$1,125,000 and less than $1,650,000, $1.00 for each dollar that Third YearEBITDA earned by the Canadian Business is less than $1,650,000 (not to exceed$525,000); or (C) if Third Year EBITDA earned by the Canadian Business isequal to or greater than $1,650,000 then by zero dollars.

#### (iii)          The consideration to bepaid, if any, pursuant to this Section 2.3(f) shall be referred to as the “ThirdYear EBITDA Consideration.”

### (g)           For illustrationpurposes only, attached hereto as Schedule 2.3 is an example calculationof the EBITDA Earn-Out Payments based upon a hypothetical situation.  The attached Schedule 2.3 is intendedto further evidence the intent of the parties with respect to the methodologyused to calculate the EBITDA Earn-Out Payments.

## **2.4****          Determination of EBITDA.**  Within forty five (45) days after the end ofany of the EBITDA Earn-Out Payment periods set forth in Section 2.3 (a)through (f) above (each an “EBITDA Earn-Out Period” and collectively the“EBITDA Earn-Out Periods”), Buyer and its auditors shall conduct areview of Buyer’s financial statements as of the end of the then-relevantEarn-Out Period and shall prepare and deliver to Seller (or Seller’s appointedrepresentative, as the case may be) a computation of EBITDA earned by theCanadian Business for such Earn-Out Period (the “EBITDA Earn-Out Notice”).  EBITDA shall be determined in accordance withGAAP as determined by Buyer and its auditors in their sole discretion.  If Seller disagrees with the computation ofEBITDA earned by the Canadian Business with respect to any EBITDA Earn-OutPeriod, Seller may, within ten (10) days after receipt of the EBITDA Earn-OutNotice, deliver a notice (an “EBITDA Earn-Out Objection Notice”) toBuyer setting forth Seller’s calculation of EBITDA earned by the CanadianBusiness for such Earn-Out Period.  IfSeller does not deliver an Earn-Out Objection Notice within such ten (10) dayperiod, then EBITDA for the Earn-Out Period shall be deemed finally determinedto be as set forth in the EBITDA Earn-Out Notice.  Buyer and Seller (each a “Party” andcollectively the “Parties” for purposes of this Section 2.4 only)agree to use reasonable best efforts to resolve any disagreements as to thecomputation of EBITDA for any particular Earn-Out Period, but if they do notobtain a final resolution within thirty (30) days after Buyer has received theEarn-Out Objection Notice, the Parties shall jointly retain an independentaccounting firm of recognized national standing to resolve any remainingdisagreements (the “Firm”).  TheParties shall direct the Firm to render a determination within thirty (30) daysafter its retention and the Parties agree to cooperate with the Firm during itsengagement.  The Firm will consider onlythose items and amounts in the calculation of EBITDA earned by the CanadianBusiness set forth in the EBITDA Earn-Out Objection Notice which the Partiesare unable to resolve.  The Parties shalleach make written submissions to the Firm promptly (and, in any event, withinthirty (30) days after the Firm’s engagement), which submissions shall containsuch Party’s computation of EBITDA earned by the Canadian Business for theEarn-Out Period and information, arguments, and support for its position.  The Firm shall review such submissions andbase its determination solely on them. In resolving any disputed item, the Firm may not assign a value to anyitem greater than the greatest value for such item claimed by either Party or 

----

## less than the smallest value for such itemclaimed by either Party.  The Firm’sdetermination will be based on the definition of EBITDA included herein.  The determination of EBITDA earned by theCanadian Business for a particular period made by the Firm shall be binding andconclusive on the parties hereto for all purposes under this Agreement (the “FinalEBITDA Determination”).  All fees ofthe Firm shall be paid by the party that proposed the EBITDA earned by theCanadian Business furthest from the Final EBITDA Determination.  If the Final EBITDA Determination is exactlyhalf way between the figure for EBITDA earned by the Canadian Business proposedby each of Buyer and Seller, then Buyer and Seller shall pay equal amounts ofthe Firm’s fees.

## **2.5****          Payment of EBITDAEarn-Out Payments.**  The payment byBuyer of any of the EBITDA Earn-Out Payments set forth in Section 2.3 maybe made in cash or Common Stock, so long as the cash portion shall not be lessthan fifty percent (50%) of any such payment.

### (a)           To the extent thatBuyer is obligated to make an EBITDA Earn-Out Payment in cash, as determined inaccordance with Section 2.5 above, Buyer shall remit such cash payment toSeller (or Seller’s appointed representative as the case may be) within fifteen(15) days of the date on which the EBITDA Earn-Out Notice is first delivered tothe Seller (or Seller’s appointed representative as the case may be).

### (b)           To the extent Buyerdetermines to pay a portion of any EBITDA Earn-Out Payments in Common Stock,the number of shares of Common Stock payable to Seller shall be equal to thequotient obtained by dividing (i) the amount of the applicable EBITDA Earn-OutPayment less that portion of the EBITDA Earn-Out Payment to be paid in cash, by(ii) the applicable Average Per Share Price. For purposes of this Section 2.5 only, the “Average Per Share Price”means the average of the closing prices per share of the Common Stock asreported on the OTC during the ten (10) trading days preceding the final dateof the applicable EBITDA Earn-Out Period, provided, however, that theapplicable Average Per Share Price shall be subject to the followinglimitations:

#### (i)            For each of the FirstQuarter EBITDA Consideration, Second Quarter EBITDA Consideration, ThirdQuarter EBITDA Consideration and Fourth Quarter EBITDA Consideration, theAverage Per Share Price shall be not less than Twenty Cents ($0.20) per share;

#### (ii)           For the Second YearEBITDA Consideration, the Average Per Share Price shall be not less than TwentyFive Cents ($0.25) per share; and

#### (iii)          For the Third YearEBITDA Consideration, the Average Per Share Price shall be not less than ThirtyCents ($0.30) per share.

### (c)           Upon finaldetermination of the number of shares of Common Stock payable pursuant toSection 2.5(b) above at the conclusion of any EBITDA Earn-Out Period,Buyer shall issue certificates representing the applicable number of shares ofCommon Stock (the “Earn-Out Shares”) to Seller within ten (10) days of the dateon which the EBITDA Earn-Out Notice is first delivered to the Seller (or Seller’sappointed representative as the case may be), provided that Seller delivers toBuyer an executed investor representation letter in a form reasonablyacceptable to Buyer.  Immediately uponreceipt of the Earn-Out Shares with respect to the First Quarter EBITDAConsideration, the Second Quarter EBITDA Consideration and the Third QuarterEBITDA 

----

### Consideration, Seller shall immediatelydeposit the certificates representing such Earn-Out Shares, together with astock power or other instrument of transfer endorsed in blank, with Buyer, tobe held in escrow by Buyer.  In the eventthere is a Repayment Obligation by Seller to Buyer pursuant to Section2.3(d)(v), Seller may elect to satisfy such Repayment Obligation by delivery toBuyer of such number of Earn-Out Shares having a value equal to the amount ofthe Repayment Obligation.  For purposesof this Section 2.5(c), the value per share of the Buyer’s Common Stock shallbe the weighted average value per share of all of the Earn-Out Shares held inescrow by Buyer, using the Average Per Share Price used to calculate the numberof Earn-Out Shares issued to Seller.  Inthe event Seller does not repay the Repayment Obligation within ten (10) daysof the Final EBITDA Determination with respect to the Fourth Quarter EBITDAConsideration, Seller shall be deemed to have elected to pay the RepaymentObligation by the transfer of Earn-Out Shares. Any Earn-Out Shares not transferred back to Buyer pursuant to thisSection 2.5 shall be promptly delivered to Seller.

### (d)           If a Final EBITDADetermination reveals that the respective EBITDA Earn-Out Payment was less thanthe Final EBITDA Determination amount, then such respective EBITDA Earn-OutPayment shall be increased by an amount obtained by subtracting the EBITDAEarn-Out Payment from the respective Final EBITDA Determination amount (the “Deficiency”).  Deficiencies shall be payable by Buyer toSeller in immediately available funds, within ten (10) days of the date onwhich the Firm has delivered its determination for such matter.

### (e)           If a Final EBITDADetermination reveals that the respective EBITDA Earn-Out Payment was greaterthan the Final EBITDA Determination amount, then such respective EBITDAEarn-Out Payment shall be decreased by an amount obtained by subtracting theFinal EBITDA Determination amount from the respective EBITDA Earn-Out Payment(the “Over Payment”).  OverPayments shall be payable by Seller to Buyer in immediately available funds,within ten (10) days of the date on which the Firm has delivered itsdetermination for such matter or Buyer may set off the aggregate of such amountagainst a future EBITDA Earn-Out Payment.

## **2.6****          Issuance of RestrictedShares.**  To the extent any shares ofCommon Stock are issued to pay some of the Closing Consideration or a portionof any EBITDA Earn-Out Payment as set forth in Section 2.5 above, suchshares shall be issued pursuant to a private placement transaction and shallnot have been, and, except as set forth in Section 6.6 below, are notbeing, registered under the Securities Act of 1933, as amended (the “SecuritiesAct”), or any applicable state securities laws, and are, therefore, subjectto certain restrictions on transferability. All shares of Common Stock to be issued pursuant to this Agreement willbe duly authorized, validly issued, fully paid and nonassessable.

## **2.7****          Adjustment to Cash Consideration**.  The Cash Consideration shall be adjusted toreflect the amount of net working capital on Seller’s Balance Sheet (ashereinafter defined) on the Closing Date (the “Net Working Capital”).  For purposes of this Agreement, “Net WorkingCapital” means current assets less current liabilities as such terms shall bedetermined in accordance with United States generally accepted accountingprinciples (“GAAP”), provided, however, that, whether or not required by GAAP,current liabilities shall include, without limitation, expenses of Sellerrelating to the transaction contemplated by this Agreement and expensesrelating to severance payments.

----

## (a)           Seller agrees todeliver an estimate of the Net Working Capital on the Closing Date (the “EstimatedNet Working Capital”).  If theEstimated Net Working Capital is less than Two Hundred Fifty Thousand Dollars($250,000) (the “Target Net Working Capital”), Buyer will decrease theCash Consideration by the amount which is obtained by subtracting the EstimatedNet Working Capital from the Target Net Working Capital.  If the Estimated Net Working Capital isgreater than the Target Net Working Capital, Buyer will increase the CashConsideration by the amount which is obtained from subtracting the Target NetWorking Capital from the Estimated Net Working Capital.

### (b)           Within thirty (30) daysfollowing the Closing Date, Buyer will provide Seller with its finalcalculation of the Net Working Capital (“Buyer’s Net Working CapitalCalculation”).  Seller shall havethirty (30) days to review Buyer’s Net Working Capital Calculation, which shallbe final and binding upon Seller unless Seller disputes the same in writingwithin such thirty (30) day period. Seller may dispute Buyer’s Net Working Capital Calculation by specifyingin reasonable detail the nature of the disagreement, the basis for suchdisagreement and Seller’s calculation of the Net Working Capital.  In the event Seller so notifies Buyer inwriting within such thirty (30) day period of any such dispute, Buyer and Sellershall attempt to resolve all such disputes in writing, and the Net WorkingCapital shall be adjusted to reflect any such resolution.  If Buyer and Seller are unable to resolve allsuch disputes within fifteen (15) days after such notification, then thematters still in dispute shall be submitted to an accounting firm mutuallyacceptable to Buyer and Seller.  If Buyerand Seller are unable to agree on the choice of an accounting firm, then theaccounting firm will be an accounting firm independent with respect to bothBuyer and Seller selected by Seller and Buyer from a list of such firmscompiled by Seller and the auditors of Buyer (the “Arbitrating Accountants”).  Buyer and Seller shall be afforded theopportunity to present to the Arbitrating Accountants (with copies to beprovided to the other party) any material related to the unresolved disputesand to discuss the issues with the Arbitrating Accountants.  The Arbitrating Accountants shall determinethe amount of each of the items being disputed and notify the parties of theArbitrating Accountants’ determinations in writing within thirty (30) daysafter the submission of the unresolved disputes to the ArbitratingAccountants.  The Arbitrating Accountantsshall resolve all remaining points of disagreement with respect to thecalculation of the Net Working Capital, which resolution shall be final andbinding upon Buyer and Seller with no right of appeal.  In making such final resolution, theArbitrating Accountants may only consider those matters identified by Buyer andSeller to be in dispute and may only determine the Net Working Capital to be anamount equal to the amount proposed by Buyer, the amount proposed by Seller orsome amount within the range of the amounts proposed by Buyer and Seller.  In resolving any disputed item, theArbitrating Accountants may not assign a value to any item greater than thegreatest value for such item claimed by either party or less than the smallestvalue for such item claimed by either party. The final determination of Net Working Capital as calculated pursuant tothis Section 2.7(b) shall be referred to herein as the “Final NetWorking Capital”.  All fees of theArbitrating Accountants shall be paid by the party that proposed the NetWorking Capital furthest from the Final Net Working Capital determined by theArbitrating Accountants.  If the FinalNet Working Capital determined by the Arbitrating Accountants is exactly halfway between the Final Net Working Capital proposed by each of Buyer and Seller,then Buyer and Seller shall pay equal amounts of the Arbitrating Accountants’fees.

### (c)           If the Final NetWorking Capital as determined in accordance with Section 2.7(b) above isdifferent from the Estimated Net Working Capital as determined inSection 2.7(a) above 

----

### then such discrepancy shall be resolved asset forth herein.  To the extent theFinal Net Working Capital is less than the Estimated Net Working Capital,Seller agrees to pay Buyer, in immediately available funds, within ten (10)days of the date on which the Final Net Working Capital is determined, theamount obtained by subtracting the Final Net Working Capital from the EstimatedNet Working Capital (the “Working Capital Adjustment”).  If Seller fails to pay the Working CapitalAdjustment within the required time period, Buyer shall, along with otherremedies that may be available to Buyer, be entitled to deduct such amount inthe aggregate from an EBITDA Earn-Out Payment. To the extent the Final Net Working Capital is greater than theEstimated Net Working Capital, Buyer agrees to pay Seller, in immediatelyavailable funds, within ten (10) days of the date on which the Final NetWorking Capital is determined, the amount obtained by subtracting the EstimatedNet Working Capital from the Final Net Working Capital.

## **2.8****          Allocation of PurchasePrice.**

### (a)           The parties agree toallocate the Purchase Price among the Purchased Assets for all purposes(including financial accounting and tax purposes) in accordance with theallocation schedule attached hereto as Schedule 2.8.  The Seller and the Buyer acknowledge thatsuch allocation represents the fair market value of the Purchased Assetsarrived at by arms’ length negotiations and shall be binding upon the partiesfor all applicable Taxes. The Seller and the Buyer each covenant to reportproceeds of acquisition or cost of acquisition, as the case may be, in a mannerconsistent with Schedule 2.8 on all Tax returns filed by each of themsubsequent to Closing and not to voluntarily take any inconsistent positiontherewith in any administrative or judicial proceeding relating to suchreturns, without the prior written consent of the other party, which consentshall not be arbitrarily or unreasonably withheld.

### (b)           The Buyer and theSeller will, at the Closing Date, jointly execute elections, in prescribed formand containing the prescribed information to have the provisions of subsection167(1) of the *Excise Tax Act*apply to the purchase and sale of the Purchased Assets hereunder in order tominimize the tax payable in respect of such purchase and sale under Part IX ofthe *Excise Tax Act*.  The Buyer will file such elections with CRAwithin the times prescribed by the applicable legislation.

## **2.9****          Transfer Taxes, Etc.**

### (a)           Subject to subsection2.9(b), the Buyer shall pay to the Seller or, where permitted by applicablelaw, directly to the appropriate governmental authority, all commodity andtransfer taxes, registration charges and transfer fees, including GST and ORSTpayable by it in respect of the purchase and sale of the Purchased Assets underthis Agreement.

### (b)           Without limiting theapplicability of Section 1.1 hereof, each of the Seller and the Buyer shall usereasonable commercial efforts to minimize the amounts referred to in Section2.9(a), including executing and delivering exemption certificates and similardocuments to the extent applicable.

----

# **ARTICLE III**

# **REPRESENTATIONS AND WARRANTIES OF SELLER AND THEPRINCIPAL OWNERS**

Subject to thedisclosures and exceptions set forth in the disclosure schedules attachedhereto (the “Seller’s Disclosure Schedules”), Seller and the PrincipalOwners hereby jointly and severally make the representations and warranties setforth hereinafter in this Article III to Buyer:

## **3.1****          Authority and BindingEffect.**  Seller has the fullcorporate power and authority to execute and deliver this Agreement and theBill of Sale (as hereinafter defined). This Agreement, and the Bill of Sale, and the consummation by Seller ofits obligations contained herein and therein, have been duly authorized by allnecessary corporate actions of Seller, including shareholder approval whichapproval is a condition to Closing, and such agreements have been duly executedand delivered by Seller.  This Agreementis a valid and binding agreement of Seller, enforceable against Seller inaccordance with its terms, subject to shareholder approval, and upon executionand delivery, the Bill of Sale will be a valid and binding agreement of Sellerand shall be enforceable against it in accordance with its terms, except asenforceability of the obligations of Seller under this Agreement and the Billof Sale may be limited by (i) bankruptcy, insolvency, moratorium or othersimilar laws affecting creditors’ rights generally, and (ii) general principlesof equity relating to the availability of equitable remedies (whether suchagreements are sought to be enforced in a proceeding at law or a proceeding inequity).  Except as set forth on Schedule 3.1,and except for approval of the shareholders of Seller and consents necessaryfor assignment of Assigned Contracts, it is not necessary for Seller to takeany action or to obtain any approval, consent or release by or from any thirdperson, government or other, to enable Seller to enter into or perform itsobligations under this Agreement and the Bill of Sale.

## **3.2****          Organization andStanding.**  Seller is acorporation duly formed, validly existing and in good standing under the lawsof Ontario and Seller is qualified to do business in each jurisdiction wheresuch qualification is necessary and where the failure to be so qualified wouldhave a Material Adverse Effect on Seller. Seller has the requisite corporate power and authority to conduct itsbusiness as now conducted and to own or lease the Purchased Assets, and to usesuch Purchased Assets in the conduct of its Business.  True and complete copies of the constatingdocuments of Seller have been delivered to Buyer.  Seller is not in violation of its constatingdocuments.  Seller has no subsidiaries.

## **3.3****          Financial Statements.**  Seller has delivered to Buyer unauditednotice to reader financial statements of Seller consisting of balance sheets asof the end of, and the related statements of income and cash flows for, each ofthe years in the three-year period ended December 31, 2005, and an unaudited balancesheet and related statements of income and cash flows for the period beginningJanuary 1, 2006 and ending September 30, 2006 (collectively, the “FinancialStatements”).  True and correctcopies of the Financial Statements are attached hereto as Schedule 3.3.The Financial Statements were prepared in accordance with GAAP, consistentlyapplied, and fairly present, on an accrual basis, the financial condition ofSeller and the results of its operations as at the relevant dates thereof andfor the respective periods covered thereby. Seller has no debts, obligations or liabilities, fixed or contingent, ofa nature that would be required, in accordance with GAAP, to be shown on abalance sheet and that are not shown on the balance sheet as of the nine (9) monthperiod 

----

## ended September 30, 2006 (the “BalanceSheet”), other than liabilities incurred after September 30, 2006 inthe ordinary course of Seller’s Business and consistent with past practices.

## **3.4****          Absence of CertainChanges.**  Except as set forth on Schedule 3.4,since September 30, 2006, there has not been:

### (a)           any sale, transfer, orother disposition of, or the incurrence or imposition of, any Encumbrance ofany kind on or affecting, any of the Purchased Assets;

### (b)           any damage, destructionor loss, whether or not covered by insurance, of any of the Purchased Assets;

### (c)           the entry or violationof any judgment, order, writ or decree that has had or could reasonably beexpected to have a Material Adverse Effect on Seller;

### (d)           any material default orbreach or any amendment, termination or revocation or, to the Knowledge ofSeller, any written threatened termination or revocation of, any of theAssigned Contracts;

### (e)           any actual orthreatened amendment, termination or revocation of any license, permit or franchiserequired for the continued operation of the Business; or

### (f)            the occurrence of anyother event or circumstance which has or could reasonably be expected to have aMaterial Adverse Effect on Seller.

## **3.5****          Title to and Conditionof Purchased Assets.**

### (a)           **Fixed Assets. **TheFixed Assets are in good working order and condition, ordinary wear and tearexcepted, have been properly maintained, are suitable for the uses for whichthey are being utilized in the Business and comply with all requirements underapplicable laws, regulations and licenses which govern the use and operationthereof.

### (b)           **Title to and Adequacy of Purchased Assets.**  Except as disclosed on Schedule 3.5hereto, Seller has, and on the Closing Date will convey and transfer to Buyer,good, complete and marketable title to all of the Purchased Assets, free andclear of all Encumbrances other than the Permitted Encumbrances of any naturewhatsoever other than restrictions on transfer of Assigned Contracts.  Except as set forth on Schedule 3.5,all of the Purchased Assets are in the exclusive possession and control ofSeller and Seller has the unencumbered right to use, and to sell to Buyer inaccordance with the terms and provisions of this Agreement, all of thePurchased Assets without interference from and free of the rights and claims ofothers.  The Purchased Assets constituteall of the assets, properties, rights, privileges and interest which Sellereither owns or controls, or uses or holds for use exclusively in connectionwith the Business and which are necessary for Buyer to own and operate theBusiness as currently conducted and as proposed to be conducted.

----

## **3.6****          Intellectual Property.**

### (a)           Set forth on Schedule1.1(h) is a complete list of all Intellectual Property Rights, owned,licensed or used (except as otherwise set out therein) by the Seller inconnection with the Business that will be transferred to Buyer (the “BusinessIntellectual Property Rights”). Except as set out in Schedule 1.1(h), all of the Business IntellectualProperty Rights are either owned or used under license by Seller, as indicatedon Schedule 1.1(h).  Use by Sellerof the Business Intellectual Property Rights owned by Seller, and, to theKnowledge of Seller and the Principal Owner, use by Seller of the Business IntellectualProperty Rights licensed by Seller, do not infringe upon or misappropriate theIntellectual Property Rights of any third party and no third party has providedSeller with notice of any such possible violation.  Seller is not aware of any valid basis forany claim of the type specified in this Section 3.6(a).  To the Knowledge of Seller and the PrincipalOwner, no third party is violating, infringing, or misappropriating anyBusiness Intellectual Property Right.

### (b)           Seller has not grantedany licenses to third parties with respect to the Business IntellectualProperty Rights. The execution, delivery and performance of this Agreement andthe transactions contemplated hereby will not in any way impair the right ofBuyer to use any Business Intellectual Property Rights or portion thereof.

### (c)           Each current and formeremployee, independent contractor and consultant of the Seller who hasparticipated in any material respect in the development of any BusinessIntellectual Property Rights has properly assigned such individual’s rights insuch Business Intellectual Property Rights to Seller.  No Seller stockholder, employee orcontractor, nor any of their respective affiliates, has any right, title orinterest in or to any Business Intellectual Property Right.

### (d)           To the Knowledge ofSeller and the Principal Owner, no employee of Seller is in violation of anyterm of any employment contract, invention disclosure agreement or any othercontract or agreement relating to Seller’s Business.

### (e)           Except as set forth in Schedule1.1(h), none of the Seller’s proprietary software or, to the Knowledge ofSeller or the Principal Owner, any software licensed to the Seller to which theSeller has made modifications contains, is based on or derived from, wasdeveloped using or with reference to or is distributed or linked (statically ordynamically) with any open source software licensed or distributed pursuant toany public license.

### (f)            The BusinessIntellectual Property Rights constitute all of the intellectual property rightsnecessary for the conduct of the Business as presently conducted by Seller.

## **3.7****          The Assigned Contractsand Other Agreements.**  Accurate andcomplete copies of all of the Assigned Contracts have been furnished by Sellerto Buyer.  Each of the Assigned Contractsis a valid and binding obligation of Seller and, to Seller’s Knowledge, theother parties thereto, enforceable in accordance with its terms, except as maybe affected by bankruptcy, insolvency, moratorium or similar laws affectingcreditors’ rights generally and general principles of equity relating to theavailability of equitable remedies. There have not been any defaults by Seller or, to the Knowledge ofSeller, defaults or any claims of default or claims of nonenforceability by theother party or parties under or with respect to any of the Assigned Contractswhich, individually or in 

----

## the aggregate, would have a Material AdverseEffect on Seller, and to the Knowledge of Seller there are no facts orconditions that have occurred or that are anticipated to occur which, with thepassage of time or the giving of notice, or both, would constitute a default bySeller, or to the Knowledge of Seller, by the other party or parties, under anyof the Assigned Contracts or would cause a creation or imposition of anyEncumbrance upon any of the Purchased Assets or otherwise would have a MaterialAdverse Effect on Seller.  None of theAssigned Contracts contains any provisions which, after the date hereof, wouldhinder or prevent Buyer from continuing to use any of the assets or property,tangible or intangible, that are the subject of the Assigned Contract in themanner in which they are currently used.

## **3.8****          Conflicts.**  Subject to obtaining all necessary consentsto assignments of Assigned Contracts, neither the execution and delivery of,nor the consummation of, the transactions contemplated by this Agreement or theBill of Sale will or could result in: (a) a default or an event that, with notice or lapse of time, or both,would be a default, breach or violation of the constating documents of Seller,or of any Assigned Contract; (b) the creation or imposition of any Encumbranceother than the Permitted Encumbrances on any of the Purchased Assets; (c) theviolation or breach of any writ, injunction or decree that would become or isnow applicable to or binding on any of the Purchased Assets; (d) a loss oradverse modification of any license, franchise, permit or other authorizationor right (contractual or other) to operate Seller’s Business or to own any ofthe Purchased Assets, granted to or otherwise held by Seller or used in itsBusiness, which would have a Material Adverse Effect on Seller; (e) the rightto cease or terminate any other business relationship or arrangement betweenSeller and any third party that would have a Material Adverse Effect on Seller;(f) the right to terminate any Assigned Contract, or the acceleration of thematurity of any indebtedness or other obligation of Seller which would have aMaterial Adverse Effect on Seller, or (g) any other consequence that would havea Material Adverse Effect on Seller.

## **3.9****          Customers.** Schedule 3.9 attached heretocontains correct and current lists of Seller’s ten (10) largest customers, interms of the revenues generated from the conduct of Seller’s Business, in thetwenty (20) month period ended August 31, 2006, showing the approximateaggregate dollar amount of revenues from each such customer during suchperiod.  Seller has no writteninformation and no Knowledge that any of the customers listed on Schedule 3.9intends to cease doing business, or not renew contracts, with Seller, or Buyerafter the Closing Date, or alter materially the amount of the business that anyof them is presently doing with Seller, or will require, as a condition to thecontinuation of its business relationship with Seller, or Buyer after theClosing Date, a change in the prices at or any other material terms under whichany of such customers has been doing business with Seller.

## **3.10****        Warranties andLiabilities.**  Schedule 3.10attached hereto sets forth the product return policies (the “Return Policies”)of, and all Warranties (as hereinafter defined) given or made by, Sellerrelating to its Business.  “Warranties”shall mean all service, repair, replacement and other obligations based upon,or arising out of, express and implied warranties made or deemed made inconnection with Seller’s Business.  SinceAugust 31, 2006, Seller has not extended or granted any return rights or givenor made any Warranties with respect to its Business, except for those set forthon Schedule 3.10.  SinceAugust 31, 2006, none of Seller’s customers has claimed to Seller that Seller’sproducts or services are defective. Seller does not know of any products or services which have beendelivered by Seller since August 31, 2006, in a condition that such products orservices 

----

## might reasonably be expected to be returnedby the customers of the Business, and Seller has not received written notice ofany intention on the part of any such customer to return any of Seller’sproducts.  Except as otherwise set forthon Schedule 3.10, Seller does not have any Knowledge of any presentor future claim against Seller, whether or not fully covered by insurance, forliability on account of negligence or product liability or on account of anyReturn Policies or Warranties of the Business which would have, individually orin the aggregate, a Material Adverse Effect on Seller, and adequate reserveshave been set aside in Seller’s financial statements for claims relating toWarranties and product returns.

## **3.11****        Insurance.**  Seller has delivered to Buyer true andcorrect copies of all insurance policies, including those relating to coveragefor fire, general liability, worker’s compensation, errors and omissions,malpractice and other forms of insurance maintained by or on behalf of Sellerin connection with its Business as protection for the Purchased Assets (the “InsurancePolicies”).  All of such policies arenow in full force and effect.  A briefdescription of each of the Insurance Policies is set forth on Schedule 3.11attached hereto.  Seller has not receivedany notice of cancellation or material amendment of any such policies.  No coverage thereunder is being disputed; andall material claims thereunder have been filed in a timely manner.

## **3.12****        Compliance withLaw/Permits.**

### (a)           Except as set forth on Schedule 3.12(a),insofar as the Business is concerned, Seller is in compliance with all, and isnot in violation of any, law, ordinance, order, decree, rule or regulation ofany governmental or regulatory agency or authority, the violation of, ornoncompliance with, which could have a Material Adverse Effect on Seller.  Except as set forth on Schedule 3.12(a),no (i) charges of violations of laws or regulations relating to its Businesshave been made or, to Seller’s Knowledge, threatened, (ii) proceedings orinvestigations relating to its Business are pending or, to Seller’s Knowledge,have been threatened, and (iii) citations or notices of deficiency have beenissued or, to Seller’s Knowledge, have been threatened, against Seller relatingto or arising out of its Business by any governmental or regulatoryauthorities, which has had or could reasonably be expected to have,individually or in the aggregate, a Material Adverse Effect on Seller; and, toSeller’s Knowledge, there are no facts or circumstances upon which any suchcharges, proceedings, investigations, or citations or deficiency notices,reasonably may be instituted, issued or brought hereafter.

### (b)           Schedule 3.12(b)contains a true, correct and complete list of all governmental or regulatorylicenses, permits, authorizations, franchises, certificates or rights(contractual or other) to operate Seller’s Business, that are held by Seller(collectively, “Licenses and Permits”). To the Knowledge of Seller, each of such Licenses and Permits are infull force and effect as of the date hereof. There is no other license, permit, authorization, franchise, certificateor right to operate the absence of which has had a Material Adverse Effect onSeller.  Seller is in compliance with theconditions and requirements imposed by or in connection with such Licenses andPermits.  Seller has not received anynotice, nor does Seller have any Knowledge, that any governmental authorityintends to cancel, terminate or modify any of such Licenses or Permits.

----

## **3.13****        Taxes and Tax Returns.** For purposes of this Agreement (a) the term “Tax”or “Taxes” means any federal, provincial, state, local or foreign income, grossreceipts, license, payroll, employment, excise, severance, stamp, occupation,premium, windfall profits, environmental (including taxes under IRCSection 59A), customs duties, capital stock, franchise, profits,withholding, social security, unemployment, disability, real property, personalproperty, sales, use, transfer, registration, value added, alternative oradd-on minimum, estimated, or other tax of any kind whatsoever, including anyinterest, penalty or addition thereto, whether disputed or not; and (b) theterm “Tax Return” means any return, declaration, report, claim for refund, orinformation return or statement (including, without limitation, informationreturns or reports related to back-up withholding and any payments to thirdparties) relating to any Taxes, including any schedule or attachment thereto,and including any amendment thereof.  AllTax Returns required to be filed with any taxing authority with respect to anytaxable period ending on or before the date of this Agreement, or the ClosingDate, as applicable, by or on behalf of Seller, have been or will be filed whendue.  All such Tax Returns are or will betrue, complete and correct in all material respects.  All Taxes due and payable by Seller have beenpaid or accrued in the Balance Sheet, except for unpaid accruable Taxesincurred by Seller in the ordinary course of its business since the date of theBalance Sheet.  Buyer shall have noliability or obligation whatsoever, and shall not incur any loss, expense orcost, and none of the Purchased Assets, or any assets of Buyer, shall besubjected to any Encumbrance, by reason of any Taxes arising out of (x) Seller’sBusiness as conducted by Seller prior to the consummation of the sale hereunderof the Purchased Assets to Buyer, or (y) any other operations or activities ofSeller whether conducted prior to the date hereof or hereafter.  Seller further represents and warrants thatit is relying solely on its own accountants and advisors for advice as to thetax consequences to it of the transactions contemplated hereby.

## **3.14****        Litigation andProceedings. **Except as set forth on Schedule 3.14,there is no action, suit, proceeding or investigation, or any counter orcross-claim in an action brought against, by or on behalf of Seller, whether atlaw or in equity, or before or by any governmental department, commission,board, bureau, agency or instrumentality, domestic or foreign, or before anyarbitrator of any kind, that is pending or, to Seller’s Knowledge,threatened,  which (i) could reasonablybe expected to affect adversely Seller’s ability to perform its obligationsunder this Agreement or the Bill of Sale or complete any of the transactionscontemplated hereby or thereby, or (ii) which may become a claim, or liability against Buyer or the PurchasedAssets.  To Seller’s Knowledge, there areno facts or circumstances that could reasonably be expected to give rise to anyactions of the type set forth in this Section 3.14.  Seller is not subject to any judgment, order,writ, injunction, decree or award of any court, arbitrator or governmentaldepartment, commission, board, bureau, agency or instrumentality havingjurisdiction over Seller, any of the Purchased Assets or its Business thataffects, involves or relates to the Purchased Assets.

## **3.15****        Environmental and SafetyMatters.**  Seller has complied with,and the operation of its Business and the use and ownership of the PurchasedAssets, are in compliance with all federal, provincial, state, regional, localor other governmental statutes, laws, ordinances, rules, regulations and ordersrelating to the protection of human health and safety, natural resources or theenvironment, including, but not limited to, air pollution, water pollution,noise control, on site or off site hazardous substance discharge, disposal orrecovery, toxic or hazardous substances, training, information and warningprovisions relating to toxic or hazardous substances, and employee safetyrelating to its business or the Purchased Assets (collectively the “EnvironmentalLaws”); and no notice of violation of any Environmental Laws or of anypermit, license or other authorization relating thereto has been received orthreatened against Seller in connection with its Business, and to 

----

## the Knowledge of Seller, there is no factualbasis for the giving of any such notice. Seller has not received any notice or claim to the effect that Seller orits Business is or may be liable to any governmental authority or private partyas a result of the release or threatened release of any toxic or hazardoussubstances in connection with the conduct or operation of its Business, and toSeller’s Knowledge, there are no facts or circumstances that could reasonablybe expected to give rise to such a claim. None of the operations of Seller’s Business or Seller and none of thePurchased Assets is the subject of any federal, state, provincial or localinvestigation evaluating whether any remedial action is needed to respond to arelease or a threatened release of any toxic or hazardous substances at anyreal properties leased, used or operated by Seller in connection with itsBusiness or any other operations or activities of Seller.

## **3.16****        Employee Benefit Plans.**

### (a)           The Seller has providedBuyer with complete and accurate (i) copies of all employee benefit plans thathave been reduced to writing and (ii) all existing written summaries of anyemployee benefit plans, whether or not reduced to writing (“Benefit Plan”).  All Benefit Plans are, and in administeringsuch plans the Seller is, in compliance in all material respects with allapplicable laws.  Except as set forth in Schedule 3.16,the occurrence of the transactions contemplated by this Agreement will notresult in the vesting or acceleration of any benefits under such Benefit Plansor any payment obligations, including severance, under any such Benefit Plans.

### (b)           All costs ofadministering and contributions required to be made by Seller to each BenefitPlan under the terms of that Benefit Plan, and all applicable laws have in allmaterial respects been timely made.  Allamounts properly accrued to date as liabilities of Seller under or with respectto each Benefit Plan (including administrative expenses and incurred but notreported claims) for the current plan year of the Benefit Plan have beenrecorded on the appropriate books, to the extent required by law or GAAP.

### (c)           Each Benefit Plan hasbeen maintained and operated in accordance with, and complies currently with,in all material respects, all applicable laws. Each Benefit Plan has been operated in all material respects in accordancewith its terms.

### (d)           Seller does notmaintain any plan that provides (or will provide) medical or death benefits toone or more, current or future former employees (including retirees) beyondtheir retirement or other termination of service.

### (e)           There are noproceedings or lawsuits, pending or, to Seller’s Knowledge, threatened, and, toSeller’s Knowledge, there are no investigations currently in progress relatingto any Benefit Plan, by any administrative agency, whether local, provincial orfederal or by any fiduciary, participant or beneficiary of such plan.

## **3.17****        Collective BargainingArrangements.** Seller is not a partyto or bound by any employee collective bargaining agreement, a party to oraffected by or, to Seller’s Knowledge, threatened with, any dispute orcontroversy with a union or with respect to unionization or collectivebargaining involving the employees of Seller.

----

## **3.18****        Accounts Receivable;Unearned Income.**

### (a)           The accounts receivablereflected on the Balance Sheet are owned free and clear by Seller and are basedon Seller’s reasonable judgment and its normal credit review procedures,business practices and GAAP, and are fully collectible in accordance with theirterms in an amount not less than their aggregate book value, except for anyamounts that become uncollectible after the Closing Date due to actions takenby Buyer which could reasonably be expected to have a material adverse effecton the collectibility of the accounts receivable.  “Aggregate book value”, for this purpose,shall mean the aggregate recorded amounts of such accounts receivable, less theaggregate recorded allowance for doubtful accounts, trade allowances and returnallowances, all as established in accordance with GAAP consistentlyapplied.  All accounts receivable forcustomer collections and billings prior to the Closing Date have been properlyrecorded on Seller’s books and records on a timely basis and in the month inwhich Seller’s efforts and activities generating such income were expended.

### (b)           The unearned incomereflected on the Balance Sheet is based on Seller’s reasonable judgment,business practices, as established in accordance with GAAP consistentlyapplied.  All unearned income relating tocontracts executed prior to the Closing Date have been properly recorded onSeller’s books and records on a timely basis and in the month in which Seller’sreceived the cash payment.

## **3.19****        Employees, Directors andOfficers.**  Schedule 3.19comprises a complete and correct list of all of Seller’s present employees whodevote a significant portion of their time to the Business (“Employees”),including the direct compensation (including wages, salaries and actual oranticipated bonuses) to be paid in the current fiscal year to suchpersons.  No unpaid salary, other thanfor the immediately preceding pay period and other than pursuant to theexisting deferred compensation plans of Seller, is now payable to any of suchEmployees.  Seller (i) is in compliancein all material respects with all applicable foreign, federal, provincial andlocal laws, rules and regulations respecting employment, employment practices,terms and conditions of employment and wages and hours, (ii) has withheld allamounts required by law or by agreement to be withheld from the wages, salariesand other payments to its employees, (iii) is not liable for any arrears ofwages or any Taxes or any penalty for failure to comply with any of theforegoing, and (iv) is not liable for any payment to any trust or other fund orto any governmental entity with respect to unemployment compensation benefits,social security or other benefits or obligations for employees.

## **3.20****        Operational Restrictions. **Seller’s Business is not subject to (a)any restrictions under any applicable laws or regulations or (b) any constatingdocument or other corporate or contractual restriction or (c) any judgment,order, writ, injunction, decree or order, which has had or could reasonably beexpected to have a Material Adverse Effect on Seller.

## **3.21****        Inventory. **The inventories of the Seller are in goodand marketable condition and are saleable in the ordinary course of business,other than what is reserved for obsolescence on the Financial Statements.  Since the date of the Balance Sheet, Sellerhas maintained inventory at levels consistent with Seller’s past practices inthe ordinary course of business.

## **3.22****        No Broker. **Seller has not retained or used theservices of an agent, finder or broker in connection with the transactionscontemplated by this Agreement.  Sellershall pay, and shall indemnify, hold harmless and defend Buyer from andagainst, all commissions, finder’s and other fees and expenses charged orasserted by any agent, finder or broker, by reason of any such retention or useof the services of any such agent, finder or broker by Seller.

----

## **3.23****        AffiliateTransactions. **Other than transactions which do not impairthe Seller’s ability to transfer good, complete and marketable title to thePurchased Assets to the Buyer, and except as set forth on Schedule 3.23,there are no loans, leases or other agreements or transaction between Sellerand any present director, officer, shareholder or employee of Seller, or toSeller’s Knowledge, any member of such director’s, officer’s, stockholder’s oremployee’s immediate family, other than compensation arrangements entered intowith employees in the ordinary course of business in connection with past.

## **3.24****        Investment Representationsand Warranties. **Seller and thePrincipal Owners (each an “Investor” for purposes of thisSection 3.24 only) represent and warrant to Parent, severally and solelywith respect to themselves and their respective investments in, and receipt of,the Common Stock hereunder, that:

### (a)           The Investor isinvesting in the Common Stock for its own account and not with a present viewtoward the public sale or distribution thereof, except pursuant to salesregistered or exempted from registration under the Securities Act; provided,however, that by making the representation herein, the Investor does not agreeto hold any of the Common Stock for any minimum or other specific term andreserves the right to dispose of the Common Stock at any time in accordancewith, or pursuant to, a registration statement filed in accordance withSection 5.5 below, or an exemption from registration under the SecuritiesAct.

### (b)           The Investor is an “accreditedinvestor” as defined in Rule 501(a) of Regulation D.  The Investor has delivered to Parent anInvestor Questionnaire in substantially the form set forth on Exhibit D.

### (c)           The Investorunderstands that the Common Stock is being offered and sold to it in relianceupon specific exemptions from the registration requirements of United Statesfederal and state securities laws and that Parent is relying upon the truth andaccuracy of, and the Investor’s compliance with, the representations,warranties, agreements, acknowledgments and understandings of the Investor setforth herein in order to determine the availability of such exemptions and theeligibility of the Investor to acquire the Common Stock.

### (d)           The Investor and itsadvisors, if any, have been furnished with all materials relating to thebusiness, finances and operations of Parent, and materials relating to theoffer and sale of the Common Stock, that have been requested by the Investor orits advisors, if any.  The Investor andits advisors, if any, have been afforded the opportunity to ask questions ofParent.  The Investor acknowledges andunderstands that its investment in the Common Stock involves a significantdegree of risk.

### (e)           The Investorunderstands that no United States federal or state agency, or any othergovernment or governmental agency, has passed upon or made any recommendationor endorsement of the Common Stock or an investment therein.

### (f)            The Investorunderstands that:

----

#### (i)            except as provided inSection 5.5 below, the Common Stock has not been, and is not being,registered under the Securities Act or any applicable state securities lawsand, consequently, the Investor may have to bear the risk of owning the CommonStock for an indefinite period of time because the Common Stock may not betransferred unless (A) the resale of the Common Stock is registered pursuant toan effective registration statement under the Securities Act, (B) the Investorhas delivered to the Company an opinion of counsel (in form, substance andscope customary for opinions of counsel in comparable transactions) to theeffect that the Common Stock to be sold or transferred may be sold ortransferred pursuant to an exemption from such registration, (C) the CommonStock is sold or transferred pursuant to Rule 144, promulgated under theSecurities Act (“Rule 144”), or (D) the Common Stock is sold ortransferred to an affiliate (as defined in Rule 144) of the Investor; providedthat, notwithstanding any other provision in this Agreement to the contrary,the parties agree and acknowledge that Seller may distribute any Common Stockthat it receives to the Shareholder, and the Shareholder may distribute anyCommon Stock that it receives to the Principal Owner, and Parent herebyconsents to any such distributions.

#### (ii)           any sale of the CommonStock made in reliance on Rule 144 may be made only in accordance with theterms of Rule 144 and, if Rule 144 is not applicable, any resale of the CommonStock under circumstances in which the seller (or the person through whom thesale is made) may be deemed to be an underwriter (as that term is defined inthe Securities Act) may require compliance with some other exemption under theSecurities Act, or the rules and regulations of the SEC thereunder; and

#### (iii)          except as provided inSection 5.5 below, neither Parent nor any other person is under any obligationto register the Common Stock under the Securities Act or any state securitieslaws or to comply with the terms and conditions of any exemption thereunder.

### (g)           The Investorunderstands that until (a) the Common Stock may be sold by the Investor underRule 144(k) or (b) such time as the resale of the Common Stock has beenregistered under the Securities Act as contemplated by Section 5.5 below, thecertificates representing the Common Stock will bear a restrictive legend insubstantially the following form (and a stop-transfer order may be placedagainst transfer of the certificates for such Common Stock):

THE SECURITIESREPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIESACT OF 1933, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE OF THE UNITEDSTATES.  THE SECURITIES MAY NOT BE SOLD,TRANSFERRED OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENTFOR THE SECURITIES UNDER APPLICABLE SECURITIES LAWS, OR UNLESS OFFERED, SOLD ORTRANSFERRED PURSUANT TO AN AVAILABLE EXEMPTION FROM THE REGISTRATIONREQUIREMENTS OF THOSE LAWS.

## **3.25****        Representations andWarranties of Seller and the Principal Owners.**  The representations and warranties of Sellerand the Principal Owners contained herein, and the disclosures contained inSeller’s Disclosure Schedule do not contain any statement of a material factthat was untrue when made or omits any information necessary to make any suchstatement contained therein, in light of the circumstances under which suchstatement was made, not misleading.  Thecopies of all documents furnished by Seller to Parent pursuant to the terms ofthis Agreement are complete and accurate copies of the original documents.

----

# **ARTICLE IV**

# **REPRESENTATIONS AND WARRANTIES OF BUYER AND PARENT**

Buyer and Parent herebymake the representations and warranties set forth in this Article IV toSeller:

## **4.1****          Authority and BindingEffect.**  Buyer and Parent have thefull corporate power and authority to execute and deliver this Agreement andthe Bill of Sale.  This Agreement, andthe Bill of Sale, and the consummation by Buyer and Parent of its obligationscontained herein and therein, have been duly authorized by all necessarycorporate actions of Buyer and Parent, and such agreements have been dulyexecuted and delivered by Buyer and Parent. This Agreement is a valid and binding agreement of Buyer and Parent,enforceable against Buyer and Parent in accordance with its terms, and, uponexecution and delivery, the Bill of Sale will be valid and binding agreementsof Buyer and Parent and shall be enforceable against them in accordance withits terms, except as enforceability of the obligations of Buyer and Parentunder this Agreement and the Bill of Sale may be limited by (i) bankruptcy,insolvency, moratorium or other similar laws affecting creditors’ rightsgenerally, and (ii) general principles of equity relating to the availabilityof equitable remedies (whether such agreements are sought to be enforced in aproceeding at law or a proceeding in equity). It is not necessary for Buyer or Parent to take any action or to obtainany approval, consent or release by or from any third person, governmental orother, to enable Buyer or Parent to enter into or perform its obligations underthis Agreement and the Bill of Sale.

## **4.2****          Organization andStanding.**  Buyer and Parent arecorporations duly organized and validly existing under, and are in goodstanding under, the laws of the Province of Ontario and State of Delaware,respectively.  Buyer and Parent have therequisite corporate power to own and operate their respective properties andassets, and to carry on their respective business as presently conducted.  Buyer and Parent are duly qualified to dobusiness and are in good standing in each jurisdiction in which the characterof the business conducted by them or the location of the properties owned orleased by them make such qualification necessary, except for jurisdictions inwhich the failure to so qualify would not have a Material Adverse Effect onBuyer or Parent.

## **4.3****          SEC Documents; FinancialStatements.**

### (a)           Parent has filed allforms, reports and documents required to be filed by Parent with the Securitiesand Exchange Commission (the “SEC”) since July 1, 2005 (the “SECDocuments”).  As of their respectivefiling dates, the SEC Documents complied in all material respects with therequirements of the Securities Act and the Securities Exchange Act of 1934, asamended (the “Exchange Act”), and none of the SEC Documents contained anyuntrue statement of a material fact or omitted to state a material fact requiredto be stated therein or necessary to make the statements made therein, in lightof the circumstances in which they were made, not misleading, except to theextent corrected by subsequently filed SEC Documents.

----

### (b)           The financialstatements of Parent included in the SEC Documents were complete and correct inall material respects as of their respective filing dates; complied as to formin all material respects with applicable accounting requirements and with thepublished rules and regulations of the SEC with respect thereto; were preparedin accordance with GAAP applied on a consistent basis and fairly present theconsolidated financial condition and operating results of Parent at the datesand during the periods indicated therein.

## **4.4****          Compliance with OtherInstruments.**  The execution anddelivery of this Agreement, the Bill of Sale, and all other agreements to beentered into in connection herewith, and the consummation of the transactionscontemplated hereby and thereby, will not conflict with or result in anyviolation of any law, rule, regulation, judgment, order, decree or ordinanceapplicable to Buyer or Parent or any of their respective properties or assets,or conflict with or result in any breach or default (with or without notice orlapse of time, or both) under, or give rise to a right of termination,cancellation or acceleration of any obligation or to loss of a materialbenefit, under (i) any provisions of the respective Certificates ofIncorporation or bylaws of Buyer or Parent; or (ii) any material agreement,contract, note, mortgage, indenture, lease, instrument, permit, concession,franchise or license or any writ, order or decree to which Buyer or Parent area party or by which Buyer or Parent or any of their respective properties are bound.

## **4.5****          Consents and Approvals;No Violations.**  Except for filings,permits, authorizations, consents and approvals as may be required under, andother applicable requirements of, the Securities Act, the Exchange Act, and therules and regulations promulgated thereunder, or of any regulatory authoritypursuant thereto, or of any state securities or blue sky laws, no filing withor notice to, and no permit, authorization, consent or approval of, any thirdparty, governmental or other entity is necessary for the consummation by Buyeror Parent of the transactions contemplated hereby.

## **4.6****          Litigation andProceedings.**  There is no action,suit, proceeding or investigation, or any counter or cross-claim in an actionbrought against, by or on behalf of Buyer or Parent, whether at law or inequity, or before or by any governmental department, commission, board, bureau,agency or instrumentality, domestic or foreign, or before any arbitrator of anykind, that is pending or, to Buyer’s Knowledge and Parent’s Knowledge,threatened, which (i) could reasonably be expected to adversely affect Buyer’sability or Parent’s ability to perform their respective obligations under thisAgreement, or the Bill of Sale, or complete any of the transactionscontemplated hereby or thereby, or (ii) which may become a claim, or liabilityagainst Buyer or Parent.  To Buyer’sKnowledge and Parent’s Knowledge, there are no facts or circumstances thatcould reasonably be expected to give rise to any actions of the type set forthin this Section 4.6.

## **4.7****          No Broker.**  Buyer and Parent have not retained or usedthe services of an agent, finder or broker in connection with the transactionscontemplated by this Agreement.  Buyerand Parent shall pay, and shall indemnify, hold harmless and defend Seller fromand against, all commissions, finder’s and other fees and expenses charged orasserted by any agent, finder or broker, by reason of any such retention or useof the services of any such agent, finder or broker by Buyer or Parent.

----

## **4.8****          Capitalization.**  The entire authorized capital stock of Parentconsists of (a) 450,000,000 Common Shares, of which 56,054,526 shares wereissued and outstanding as of September 30, 2006, and no shares were held intreasury as of September 30, 2006, and (b) 10,000,000 Series A PreferredShares, of which none was issued and outstanding and none was held in treasuryas of September 30, 2006.  All ofthe issued and outstanding shares of capital stock of Parent have been dulyauthorized and are validly issued, fully paid and non-assessable.  There are no preemptive rights that have notbeen waived or terminated with respect to the shares of Common Stock to beissued to Seller pursuant to this Agreement. All shares of Common Stock to be issued to Seller pursuant to thisAgreement will be duly authorized for issuance, validly issued, fully paid andnonassessable and of the same class of Common Shares as are currently listed byParent for trading on the OTC under the symbol “DYNK”.  Each share of Common Stock of Parent,including each share issued to Seller pursuant to this Agreement, has one voteper share on all matters on which the stockholders of Parent are entitled tovote.

## **4.9****          Representations andWarranties of Buyer.**  Therepresentations and warranties of Buyer contained herein do not contain anystatement of a material fact that was untrue when made or omits any informationnecessary to make any such statement contained therein, in light of thecircumstances under which such statement was made, not misleading.  The copies of all documents furnished byBuyer to Seller pursuant to the terms of this Agreement are complete andaccurate copies of the original documents.

# **ARTICLE V**

# **OBLIGATIONS SURVIVING THE CLOSING**

## **5.1****          Payment of SecuredObligations and Termination of Liens and Encumbrances.** Seller hereby covenants that Seller shall havearranged to pay, prior to the Closing Date, all of the indebtedness or otherobligations listed on Schedule 5.1 (the “Secured Obligations”)other than the Permitted Encumbrances and for the holders of the SecuredObligations to deliver, in exchange for such payment, (i) a Financing ChangeStatement issued by the Ontario Personal Property Registry evidencing adischarge of such registered security interest or such other instruments anddocuments as Buyer may reasonably request to effectuate the removal andtermination of any Encumbrances affecting any of the Purchased Assets andevidence the release by such holders of any claims they may have against thePurchased Assets or the Business, and (ii) such documents as Buyer mayreasonably request to evidence the payment of such Secured Obligations.  If it is determined at any time hereafterthat Seller failed to remove or cause to be removed, without liability or costor expense to Buyer and without the disposition or diminution in the value ofany of the Purchased Assets, any Encumbrance on any of the Purchased Assetsthat was in existence prior to the Effective Time, or if any Encumbrance isimposed or placed on any of the Purchased Assets (or any replacements thereof)after the Closing Date as a result of any act or omission of Seller, occurringprior to the Effective Time, then, without limiting any other right or remedyBuyer may have, Seller shall cause such Encumbrance to be removed at no expenseor liability to Buyer, and without any reduction or disposition of any of thePurchased Assets; provided, that in the first instance Buyer shall notifySeller of the Encumbrance and provide Seller with an opportunity to cause suchEncumbrance to be removed.

----

## **5.2****          Further Assurances.**  Each party hereto shall execute and deliver,after the date hereof, such additional documents or instruments, and shall takesuch additional actions, as the other party may reasonably request in order tocarry out the intent of this Agreement or to better evidence or effectuate thetransactions contemplated herein.

## **5.3****          Expenses.**  Unless otherwise specifically provided forherein, each party shall pay all of its respective costs and expenses incurredor to be incurred by it in negotiating and preparing this Agreement and theother agreements contemplated hereby, and in carrying out and closing thetransactions contemplated by this Agreement whether or not this Agreement orthe transactions contemplated hereby are ever consummated.

## **5.4****          Taxes.**  Seller shall pay all Taxes of any kind ornature arising from (i) the conduct or operation of its business up to theClosing Date and the conduct or operation by Seller, prior to or after theClosing Date, of any other business or business activities operations and (ii)any liquidation, partial or whole, of Seller. If any Taxes required under this Section 5.4 to be borne by Sellerare assessed against Buyer or any of the Purchased Assets, Buyer shall notifySeller in writing promptly thereafter and Seller shall be entitled to contest,in good faith, such assessment or charge so long as such assessment does notcause a Material Adverse Effect on Buyer or the Purchased Assets or Buyer’sbusiness.  Notwithstanding the foregoing,Buyer may (but shall not be obligated to) pay any such Taxes assessed againstit, its business or any of the Purchased Assets, but which are payable bySeller pursuant hereto, if Buyer’s failure to do so, in the reasonable judgmentof Buyer, could result in the immediate imposition of an Encumbrance on any ofthe Purchased Assets or any other assets of Buyer or if Seller fails to contestsuch assessment or charge diligently and in good faith.  If in accordance with the immediatelypreceding sentence, Buyer pays any Taxes which pursuant hereto are required tobe borne by Seller, Buyer shall be entitled to reimbursement thereof fromSeller in accordance with the indemnity provisions set forth in Article Xhereof.

## **5.5****          Registration Rights.**

### (a)           **Piggyback Registration.**  If at any time following issuance of theCommon Stock pursuant to this Agreement (such shares of the Common Stock, forpurposes of this Section 5.5 and Section 5.6 only, are collectivelyreferred to as the “Registrable Shares”) Buyer shall determine toregister any of its Common Stock under the Securities Act other than pursuantto (1) a registration relating solely to the sale of securities to participantsin a Buyer employee benefits plan, (2) a registration relating to securitiesissued in connection with an acquisition by Buyer, or (3) a registration inwhich the only Common Stock being registered is Common Stock issuable uponconversion of debt securities which are also being registered, it shall send toSeller (or Seller’s appointed representative, as the case may be) writtennotice of such determination and, if within twenty (20) days after receipt ofsuch notice, Seller shall so request in writing, Buyer shall use itscommercially reasonable best efforts to include in such registration all or anypart of the Registrable Shares that Seller requests to be registered, provided,however, that if such registration involves an underwritten public offering andthe managing underwriter reasonably determines that marketing factors require alimitation on the number of shares that may be included in the registration,the number of shares to be included in such registration shall be reduced asfollows:  (i) First, the Common Stockheld by officers and directors of Buyer shall be ratably excluded to the extentrequired by such limitation,  (ii)Second, the Registrable Shares requested to be registered by Seller

----

### and all other selling stockholders whoacquired registration rights after the date of this Agreement shall be ratablyexcluded to the extent required by such limitation, and (iii) Third, the CommonStock requested to be registered by selling stockholders with registrationrights other than under this Agreement and granted before the date hereof shallbe excluded to the extent required by such limitation.  If Seller disapproves of the terms of suchunderwriting, he may elect to withdraw therefrom by written notice to Buyer andthe underwriter.

### (b)           **Seller Information.**  Seller covenants and agrees that it shallprovide to Buyer on a timely basis such consents, representations andinformation as may reasonably be required by Buyer in connection with thepreparation and filing of a registration statement or related prospectus or anyamendment or supplement thereto.

### (c)           **Expenses.** Buyer shall pay all expenses of registration of any shares of the CommonStock pursuant to Section 5.5(a), except brokerage commissions, legal feesand expenses, and such other fees and expenses as may be incurred by Seller,which commissions and expenses shall be paid by the Seller.

### (d)           **Notification.**  Buyer will promptly notify Seller upon theoccurrence of any of the following events in respect of a registrationstatement or related prospectus: (i) receipt of any request for additionalinformation by the SEC or any other federal or state governmental authorityduring the period of effectiveness of the registration statement or amendmentsor supplements to the registration statement or any related prospectus; (ii)the issuance by the SEC or any other federal or state governmental authority ofany stop order suspending the effectiveness of the registration statement orthe initiation of any proceedings for that purpose; (iii) receipt of anynotification with respect to the suspension of the qualification or exemptionfrom qualification of the Registrable Shares registered pursuant toSection 5.5(a) for sale in any jurisdiction or the initiation of anyproceeding for such purpose; (iv) the happening of any event that makes anystatement made in the registration statement, or related prospectus, or anydocument incorporated or deemed to be incorporated therein by reference, untruein any material respect or that requires the making of any changes in theregistration statement, related prospectus, or other documents so that, in thecase of the registration statement, it will not contain any untrue statement ofa material fact or omit to state any material fact required to be statedtherein or necessary to make the statements therein not misleading, and that inthe case of the related prospectus, it will not contain any untrue statement ofa material fact or omit to state any material fact required to be statedtherein or necessary to make the statements therein, in the light of thecircumstances under which they were made, not misleading.

### (e)           **Assignment of Registration Rights.**  The rights set forth in thisSection 5.5, may be assigned by Seller to transferees or assignees of allor any portion of the Registrable Shares, but only if (a) Seller agrees inwriting with the transferee or assignee to assign such rights, and a copy ofsuch agreement is furnished to Buyer within a reasonable time after suchassignment, (b) Buyer is, within a reasonable time after such transfer orassignment, furnished with written notice of the name and address of suchtransferee or assignee and the securities with respect to which suchregistration rights are being transferred or assigned, (c) after such transferor assignment, the further disposition of such securities by the transferee orassignee is restricted under the Securities Act and applicable state securitieslaws, and (d) at or before the time Buyer received the written noticecontemplated by clause (b) of this sentence, the transferee or assignee agreesin writing with Buyer to be bound by all of the provisions contained herein.

----

### (f)            **Additional Requirements.**  Until termination of the registrationstatement, Buyer will use all commercially reasonable efforts to make and keepcurrent public information available, as those terms are understood and definedin Rule 144, and file on a timely basis with the SEC all information that itmay be required to file under either Section 13 or Section 15(d) ofthe Exchange Act, and, so long as it is required to file such information(without regard to the effectiveness of any registration statement), use allcommercially reasonable efforts to maintain the availability of Rule 144 (orany successor exemptive rule hereinafter in effect) with respect to shares ofthe Common Stock and to cooperate with any holder of Common Stock who desiresto make a sale under Rule 144.

### (g)           **Termination.**  The registration rights of Seller underSection 5.5(a) shall terminate on such date as the Registrable Shares areotherwise saleable under Rule 144 without limitations on volume during anyninety (90) day period.

## **5.6****          Market Stand OffAgreement.**  The Seller and thePrincipal Owners agree that, if requested by the managing underwriter of aregistration of the Registrable Shares in accordance with Section 5.5above, they will not, without prior written consent of such underwriter, sellor otherwise transfer or dispose of any of their respective Registrable Shares(other than to donees who agree to be similarly bound), and, in the case ofSeller, will use commercially reasonable best efforts to prevent any of itsofficers, directors, employees, consultants, or affiliates who hold RegistrableShares from selling or otherwise transferring or disposing of any of theirrespective Registrable Shares, during such period of time, not to exceed ninety(90) days following the effective date of the registration statement filed byBuyer with respect to such registration of Registrable Shares.

## **5.7****          Employment of Seller’sEmployees. **Buyer covenants that itshall, conditional on Closing, and prior to the Closing Date, extend offers ofemployment substantially in the form of the offer attached hereto as Schedule 5.7“A” to all of the current Employees of the Business listed on Schedule 3.19on terms and conditions in the aggregate no less favourable than those on whichthey were employed by Seller and honour their years of service and seniorityfor all purposes to the extent permitted under applicable employee benefitplans.  Schedule 5.7 “B” setsout the base salary that will be payable by Buyer to those Employees thataccept the Buyer’s offer of employment. The Seller shall co-operate with the Buyer in its efforts to ensure thateach Employee accept offers of employment; provided that in providing suchcooperation, Seller shall not be required to expend funds or incur anyobligations or liabilities in connection therewith.  In respect of the period during which theEmployees are considering Buyer’s offer of employment hereunder, as betweenBuyer and Seller, Buyer shall be responsible for (i) the remuneration payableto each Employee in respect of the period commencing at the Effective Time andending at the time such Employee accepts or rejects, as the case may be, Buyer’soffer of employment, and (ii) the obligations and liabilities of an employer ofsuch Employees; provided that for greater certainty, the Buyer shall not beresponsible for and is not assuming hereunder any obligation or liability owedto any Employee that rejects Buyer’s offer of employment hereunder fortermination pay, severance pay or damages in lieu of notice of termination, whichshall be considered a Retained Liability hereunder.

----

# **ARTICLE VI**

# **SURVIVAL OF REPRESENTATIONS AND WARRANTIES**

All of the respectiverepresentations and warranties of Seller and Buyer set forth in this Agreementor in any of such party’s disclosure schedules, or in any certificatesdelivered by such party on the Closing Date shall survive the consummation ofthe transactions contemplated hereby for eighteen (18) months.  The covenants of any party hereto that cannotbe or are not fully performed by such party on or prior to the Closing Dateshall survive until they are otherwise terminated pursuant to their terms orfully performed.

# **ARTICLE VII**

# **CONDITIONS PRECEDENT TO THE OBLIGATIONS OF BUYER**

The obligation of Buyerto consummate the purchase of the Purchased Assets from Seller is subject tothe fulfillment, or the waiver by Buyer, at or prior to the Closing, of each ofthe following conditions precedent:

## **7.1****          Absence of MaterialLitigation.**  Except as set forth on Schedule 3.14,there shall be (a) no pending or overtly threatened litigation (other thanlitigation which is determined by the parties in good faith, after consultingtheir respective attorneys, to be without legal or factual substance or merit),whether brought against Seller or Buyer, that seeks to enjoin the consummationof any of the transactions contemplated by this Agreement, (b) no order thathas been issued by any court or governmental agency having jurisdiction thatrestrains or prohibits the consummation of the purchase and sale of the PurchasedAssets hereunder and no proceedings pending which are reasonably likely toresult in the issuance of such an order; and (c) no pending or overtlythreatened litigation, which has had or is reasonably expected to have aMaterial Adverse Effect on Seller.

## **7.2****          Performance ofObligations.**  Seller shall haveperformed and complied, in all material respects with all of the covenantsrequired by this Agreement to have been performed prior to the Closing.

## **7.3****          No Material AdverseChange.**  Since the date of thisAgreement, there shall not have been any change in or other event that has hador is reasonably expected to have a Material Adverse Effect on Seller.

## **7.4****          Delivery of AdditionalInstruments.**  On the Closing Date,Seller shall deliver, or cause to be delivered to Buyer, the followingdocuments and instruments, in form and substance satisfactory to Buyer and itscounsel, unless waived in writing by Buyer:

### (a)           The Bill of Sale andAssumption Agreement in substantially the form of Exhibit B hereto, duly executedby Seller (the “Bill of Sale”);

### (b)           Evidence of the receiptof all third party consents described on Schedule 3.1 or otherwisereferred to in Section 3.1 in connection with the consummation of thetransactions contemplated herein;

----

### (c)           A legal opinion ofcounsel to Seller in such form as is reasonably satisfactory to Buyer;

### (d)           A Certificate ofStatus, dated as of a date that is not more than ten (10) days prior to theClosing Date, from the Ministry of Consumer and Business Affairs of theProvince of Ontario, for Seller; and

### (e)           Such other documentsand instruments as Buyer or Buyer’s counsel may reasonably request so as betterto evidence or effectuate the transactions contemplated hereby.

## **7.5****          Employment Agreementsfor Key Employees.**  Buyer shall haveentered into agreements for employment with each of the Employees of Seller(the “Employment Agreements”) as set forth in Section 5.7 hereof.

## **7.6****          Shareholder Approval.**  This Agreement, and the transactionscontemplated hereby, shall have been duly approved by special resolution (asprovided for under the *Business CorporationsAct* (Ontario)) of the shareholders of Seller.

# **ARTICLE VIII**

# **CONDITIONS PRECEDENT TO OBLIGATIONS OF SELLER**

The obligation of Sellerto consummate the sale of the Purchased Assets to Buyer is subject to thefulfillment, or the waiver by Seller, at or prior to the Closing, of each ofthe following conditions precedent:

## **8.1****          Absence of MaterialLitigation.** There shall be (a) nopending or overtly threatened litigation (other than litigation which isdetermined by the parties in good faith, after consulting their respectiveattorneys, to be without legal or factual substance or merit), whether broughtagainst Seller or Buyer that seeks to enjoin the consummation of any of thetransactions contemplated by this Agreement, (b) no order that has been issuedby any court or governmental agency having jurisdiction that restrains orprohibits the consummation of the purchase and sale of the Purchased Assetshereunder and no proceedings pending which are reasonably likely to result inthe issuance of such an order, and (c) no pending or overtly threatenedlitigation which has had or is reasonably expected to have a Material AdverseEffect on Buyer.

## **8.2****          Performance ofObligations.**  Buyer shall have performedand complied in all material respects with all of its covenants required bythis Agreement to have been performed by it at or prior to the Closing.

## **8.3****          No Material AdverseChange.**  Since the date of thisAgreement, there shall not have been any change in or other event that has hador is reasonably expected to have a Material Adverse Effect on Buyer.

## **8.4****          Delivery of AdditionalInstruments.**  On the Closing Date,Buyer shall deliver, or cause to be delivered to Seller, the followingdocuments and instruments, in form and substance satisfactory to Seller and itscounsel, unless waived in writing by Seller:

----

### (a)           The Bill of Sale dulyexecuted by Buyer;

### (b)           Legal opinions ofcounsels to Parent and Buyer in such forms as are reasonably satisfactory toSeller;

### (c)           A good standingcertificate, dated as of a date that is not more than ten (10) days prior tothe Closing Date, from the Secretary of State of Delaware, for the Parent;

### (d)           A Certificate of Statusdated as of a date that is not more than ten (10) days prior to the ClosingDate, from the Ministry of Consumer and Business Affairs of the Province ofOntario; and

### (e)           Such other documentsand instruments as Seller or Seller’s counsel may reasonably request so asbetter to evidence or effectuate the transactions contemplated hereby.

## **8.5****          Delivery ofConsideration.**  At the Closing, Buyershall deliver to Seller a cash payment in the amount set forth inSection 2.2(a) hereof, wired to an account designated by Seller, andParent shall issue an irrevocable instruction letter to its transfer agentauthorizing the transfer agent to issue shares of Common Stock to Seller as setforth in Section 2.2(b) hereof.

## **8.6****          Employment Agreementsfor Key Employees.**  Buyer shall haveentered into the Employment Agreements as set forth in Section 5.7 hereof.

## **8.7****          Reservation of StockOptions. **On the Closing Date, Buyershall have reserved for issuance and granted to employees of Buyer who wereformerly employees of Seller, an aggregate of Three Hundred Thousand (300,000)options (the “Options”) to purchase shares of Common Stock from Parent’sstock option plan (the “Stock Option Plan”).  The Common Stock issuable upon exercise ofthe Options shall be shares of the Common Stock of Parent which are the same asthose shares of Parent quoted for trading on the OTC on the Closing Date.  The exercise price of the Options shall bethe price at which the last trade was made in the Common Stock of Parent asquoted on the OTC on the last day the OTC was open for trading immediatelypreceding the Closing Date.  The Optionsshall vest annually subsequent to the Closing Date at a rate of 33 1/3% perannum, all as set forth on Schedule 8.7. Buyer shall grant and allocate the Options to the persons and in theamounts set forth on Schedule 8.7 hereto.  In the event, a person listed on Schedule 8.7is no longer employed by Buyer, or an affiliate of Buyer, on the date that anyof the Options are scheduled to vest, Buyer shall cancel such previous grant ofthe Options to such former employee and shall reallocate such Options on a prorata basis among the remaining persons listed on Schedule 8.7.  Buyer shall deliver evidence of such grantsto Seller at the Closing.

**8.****8****          Payment of SecuredObligations. **On the Closing Date,the Buyer shall pay the full amount of the Secured Obligations, the finalpayments for which shall be determined by the delivery of pay off letters toBuyer not later than the day before the Closing Date.  The total amount to be paid by the Buyer forthe Secured Obligations pursuant to this Section 8.8 is $657,582.65.

----

# **ARTICLE IX**

# **THE CLOSING**

The consummation of thetransactions contemplated hereby (the “Closing”) shall take place on thefirst business day following the satisfaction or waiver of the closingconditions set forth in Article VII and Article VIII above (the “ClosingDate”) at the offices of Stradling Yocca Carlson & Rauth or at suchother date and place as the parties may agree and shall be deemed to occur at12:00 p.m., California time (the “Effective Time”), on such date; provided,however, that the Closing shall occur on or prior to October 30, 2006.

## **9.1****          Closing Deliveries ofSeller.**  At the Closing, Seller shalldeliver, or cause to be delivered to Buyer, the documents and instruments setforth in Article VII above, in form and substance reasonably satisfactoryto Buyer and its counsel.

## **9.2****          Closing Deliveries ofBuyer.**  At the Closing, Buyer shalldeliver, or cause to be delivered, the Purchase Price to Seller and thedocuments and instruments set forth in Article VIII above, in form andsubstance reasonably satisfactory to Seller and its counsel.

# **ARTICLE X**

# **INDEMNIFICATION**

## **10.1****        Obligations of Seller.**  Seller and the Principal Owners hereby agree,jointly and severally, that they will indemnify, hold harmless and defend Buyerand each of its directors, officers, members, employees and agents and therespective successors and assigns of Buyer and such persons (all of theforegoing, collectively, the “Indemnified Parties” or, individually, an “IndemnifiedParty”), from and against any and all Losses that arise from or are inconnection with:

### (a)           any breach of orinaccuracy in any of the representations or warranties of Seller contained inthis Agreement or in Seller’s Disclosure Schedules or other documentscontemplated hereby;

### (b)           any breach or defaultby Seller or the Principal Owners of any of the covenants or agreementscontained in this Agreement;

### (c)           the failure by Selleror the Principal Owners to discharge when due any of the Retained Liabilities;

### (d)           the failure to havepaid or to pay, when due, any Taxes that arose out of the operations of Selleror the consummation of the transactions contemplated by this Agreement or thefailure to have filed, when due, any Tax Returns related to any such Taxes orany period up to the Closing Date, whether or not such failure constitutes abreach of the representations or warranties of Seller contained inSection 3.13 or is disclosed in this Agreement or Seller’s DisclosureSchedules; and

### (e)           the failure to complywith the *Bulk Sales Act* (Ontario).

----

## **10.2****        Limitations on Obligationsof Seller. **In no event shall Selleror the Principal Owners have any obligation to indemnify the IndemnifiedParties for or in respect of any of the Assumed Obligations identified on Schedule 1.3,and Buyer agrees to indemnify, hold harmless and defend Seller and thePrincipal Owners (in the same manner and on the same terms and conditions thatare applicable to Seller and the Principal Owners’ indemnification obligationsunder this Article X), from and against any and all Losses, incurred by Selleror the Principal Owners as a result of (a) any failure by Buyer to pay orotherwise discharge, or from any failure by Buyer to comply with the provisionsof, any of the Assumed Obligations after the Closing Date, or (b) any breach ordefault by Buyer of any of its covenants or agreements, or any representationsor warranty hereunder (in which case the provisions of this Article Xshall apply mutatis mutandis).

No Indemnified Partyshall be entitled to any indemnification under this Article X with respectto any particular representation or warranty unless it gives notice to theIndemnifying Party with respect to the claim for indemnification at a timeduring which the particular representation or warranty with respect to theclaim is made survives pursuant to Article VI.

## **10.3****        Claims Procedure.** Promptly after the receipt by any IndemnifiedParty of notice of the commencement of any action or proceeding against suchIndemnified Party, such Indemnified Party shall, if a claim with respectthereto is or may be made against any indemnifying party (the “IndemnifyingParty”) pursuant to this Article X, give such Indemnifying Partywritten notice of the commencement of such action or proceeding and give suchIndemnifying Party a copy of such claim and/or process and all legal pleadingsin connection therewith.  The failure togive such notice shall not relieve any Indemnifying Party of any of itsindemnification obligations contained in this Article X, except where, andsolely to the extent that, such failure adversely affects or prejudices therights of such Indemnifying Party.  SuchIndemnifying Party shall have the right to defend, at his or its own expenseand by his or its own counsel reasonably acceptable to the Indemnified Party,any such matter involving the asserted liability of the Indemnified Party;provided, however, that the Indemnified Party shall have the right toparticipate in the defense or such asserted liability at the Indemnified Party’sown expense.  In any event, theIndemnified Party, such Indemnifying Party and its counsel shall cooperate inthe defense against, or compromise of, any such asserted liability, and incases where the Indemnifying Party shall have assumed the defense, theIndemnified Party shall have the right to participate in the defense of suchasserted liability at the Indemnified Party’s own expense.  In the event that such Indemnifying Partyshall decline to participate in or assume the defense of such action, inaccordance with the provisions hereof, or if the Indemnifying Partydiscontinues the diligent and timely conduct thereof, any of the IndemnifiedParties may undertake such defense and the Indemnifying Party shall beresponsible for reimbursing the Indemnified Parties for their reasonable legalfees and expenses in connection therewith as and when such fees and expensesare incurred by them.  If theIndemnifying Party is defending the claim as set forth above, the IndemnifyingParty shall have the sole right to settle the claim, subject to obtaining theconsent of the Indemnified Party, which consent will not unreasonably bewithheld or delayed; provided, however, that if the Indemnified Party shallfail to consent to the settlement of such a claim by the Indemnifying Party,which settlement (i) the claimant has indicated it will accept, and (ii)includes an unconditional release of the Indemnified Party by the claimant andimposes no restrictions on the future activities of the Indemnified Party andits affiliates, the Indemnifying Party shall have no liability with respect toany payment required to be made to such claimant in respect of such claim.  If the Indemnified Party is defending theclaim as set forth above, the Indemnified Party shall have

----

## the right to settle or compromise any claimagainst it after consultation with, but without the necessity of obtaining theprior approval of, any Indemnifying Party, provided, however, that suchsettlement or compromise shall not, unless consented to in writing by suchIndemnifying Party, which consent shall not be unreasonably withheld, beconclusive as to the liability of such Indemnifying Party to the IndemnifiedParty.

## **10.4****        Limitations on Liability.**  No indemnification for breaches ofrepresentations, warranties and covenants for all claims underSection 10.1(a) and (b) shall be made unless the aggregate amount ofLosses incurred by the Indemnified Party exceeds Ten Thousand Dollars($10,000); provided, however, that in the event the Losses exceed such amount,indemnification shall be made with respect to all Losses, and provided however,in no event shall indemnification under Section 10.1(a) and (b) forbreaches of representations, warranties and covenants exceed the Purchase Priceactually paid by Buyer to Seller. Indemnification pursuant to this Article X shall be the sole andexclusive remedy for breaches of representations and warranties and covenantsto be performed prior to Closing.

# **ARTICLE XI**

# **MISCELLANEOUS**

## **11.1****        Assignment.**  Neither Seller nor Buyer may assign thisAgreement, or assign its rights or delegate its duties hereunder, without theprior written consent of the other party hereto.  This Agreement will be binding upon, inure tothe benefit of, and be enforceable by the parties and their respectivesuccessors and assigns.

## **11.2****        Severability. **Any provision of this Agreement which isillegal, invalid or unenforceable shall be ineffective to the extent of suchillegality, invalidity or unenforceability, without affecting in any way theremaining provisions hereof.

## **11.3****        Governing Law. **This Agreement, its construction and theremedies for its enforcement or breach are to be applied pursuant to, and inaccordance with, the laws of the State of Delaware, without regard to theprinciples of conflicts of law thereof.

## **11.4****        Consent to Jurisdiction,Service and Venue. **For the purposeof any suit, action or proceeding arising out of or relating to this Agreement,each of the parties hereby agrees that exclusive jurisdiction and venue for anysuit between the parties shall be in the courts of the State of Delaware or theProvince of Ontario, regardless of the convenience of such forums.  Neither party will oppose the enforcementagainst it in any other jurisdiction of any judgement or order obtained from aDelaware or Ontario court regarding this Agreement. The parties further agreeand consent to accept and acknowledge all service of process carried out bymeans of registered mail, return receipt requested, in accordance withSection 11.10,  in connection withany such matter.

## **11.5****        Judgment Currency.**  If for the purpose of obtaining judgmentagainst a party in any court in any jurisdiction with respect to thisAgreement, it becomes necessary to convert into the currency of suchjurisdiction (in this Section referred to as the “Judgment Currency”)any amount due hereunder in any currency other than the Judgment Currency (inthis Section referred to as the

----

## “Currency of the Agreement”), thenconversion shall be made at the rate of exchange prevailing on the Business Daypreceding (i) the date of actual payment of the amount due, in the case ofproceedings in the courts of any jurisdiction that will give effect to suchconversion being made on such day, or (ii) the day on which the judgment isgiven, in the case of proceedings in the courts of the Province of Ontario orof any other jurisdiction (the applicable date as of which such conversion ismade pursuant to this Section being referred to as the “JudgmentConversion Date”).  For this purpose,“rate of exchange” means the rate at which the Royal Bank of Canadawould be prepared on the relevant date, to sell the Currency of the Agreementto obtain the Judgment Currency.  In theevent that there is a change in the rate of exchange prevailing between theJudgment Conversion Date and the date of payment of the amount due, the Partyagainst which judgment is rendered shall, on the date of payment, pay suchadditional amounts (if any) as may be necessary to ensure that the amount paidon such date is the amount in the Judgment Currency which, when converted atthe rate of exchange prevailing on the date of payment, is the amount then dueunder this Agreement in the Currency of the Agreement.  Any additional amount due under thisSection 11.4 will be due as a separate debt and shall not be affected byjudgment being obtained for any other sums due or in respect of this Agreement.

## **11.6****        Bulk Sales. **In consideration of the indemnityprovided herein by the Seller and the Principal Owners to the Buyer, the Buyerhereby waives compliance by the Seller with the provisions of any applicablebulk transfer laws, including the *Bulk SalesAct*(Ontario), of any jurisdiction in connection with thetransactions contemplated by this Agreement.

## **11.7****        Entire Agreement;Amendment. **This Agreement, includingthe exhibits and schedules hereto, and each additional agreement or otherdocument to be executed and delivered pursuant hereto, constitute all of theagreements of the parties with respect to, and supersede all prior agreementsand understandings relating to the subject matter of, this Agreement and thetransactions contemplated hereunder. This Agreement may not be modified or amended except by a writteninstrument specifically referring to this Agreement signed by the partieshereto.

## **11.8****        Waiver.**  No waiver by one party of the other party’sobligations, or of any breach or default hereunder by any other party, shall bevalid or effective, unless such waiver is set forth in writing and is signed bythe party giving such waiver; and no such waiver shall be deemed a waiver of anysubsequent breach or default of the same or similar nature or any other breachor default by such other party.

## **11.9****        Interpretation;Headings. **This Agreement is theresult of arms’-length negotiations between the parties hereto and no provisionhereof, because of any ambiguity found to be contained therein or otherwise,shall be construed against a party by reason of the fact that such party or itslegal counsel was the draftsman of that provision.  The section, subsection and any paragraphheadings contained herein are for the purpose of convenience only and are notintended to define or limit or affect, and shall not be considered inconnection with, the interpretation of any of the terms or provisions of thisAgreement.

## **11.10****      Notices. **All notices, requests, demands or othercommunications hereunder shall be in writing and shall be deemed to have beenduly given to the person designated below (i) on the date of delivery ifdelivered in person; (ii) on the first business day after being sent by fax, providedthat

----

## the successful transmission of the fax hasbeen confirmed through a confirmation function sheet provided by the faxmachine used for such transmission; (iii) on the third business day followingthe deposit thereof in the United States Mail or in Canada Post, provided it ismailed by certified mail, return receipt requested and postage prepaid andproperly addressed; or (iv) on the second business day after being sent by aircourier.  Any party hereto may from timeto time, by written notice to the other parties, designate a different address,which shall be substituted for the one specified below:

If to Seller:

Sensible SecuritySolutions Inc.

45 O’Connor Street, Suite870

Ottawa, Ontario CanadaK1P 1A4

Attn:  Paul Saucier

Fax:   (613)721-6744

with a copy to:

Gowling Lafleur HendersonLLP

160 Elgin Street, Suite2600

Ottawa, Ontario Canada K1P1C3

Attn:  Michael Boehm

Fax:   (613)788-3467

If to Buyer, to:

DynTek, Inc.

19700 Fairchild Road,Suite 230

Irvine, California 92612

Attn:  Chief Executive Officer

Fax:  (949) 271-6798

with a copy to:

Stradling Yocca Carlson& Rauth

660 Newport Center Drive,Suite 1600

Newport Beach, CA 926606441

Attn:  Christopher D. Ivey

Fax:  (949)725-4100

## **11.11****      Public Announcements.** Neither Seller or Buyer will make any publicannouncements concerning matters set forth in this Agreement or the negotiationthereof without the prior written consent of the other party unless suchdisclosure is required by law or the rules and regulations of the SEC.  Any such disclosure shall be provided forreview to the other party in advance of public release to the extent reasonablypractical.

----

## **11.12****      Attorneys Fees.**  If any action or proceeding relating to thisAgreement or the enforcement of any provision of this Agreement is brought by aparty hereto against any party hereto, the prevailing party shall be entitledto recover reasonable attorneys’ fees, costs and disbursements, in addition toany other relief to which the prevailing party may be entitled.

## **11.13****      Counterparts. **This Agreement may be executed inseparate counterparts, each of which shall be deemed an original, but all ofwhich together shall constitute one and the same instrument.  This Agreement shall become effective whencounterparts have been signed by each of the parties and delivered by facsimileor other means to the other party.

***[Signature page to follow]***

----

IN WITNESS WHEREOF, eachof Seller, Buyer and the Principal Owners have caused a duly authorizedrepresentative to execute this Asset Purchase Agreement on the date firstwritten above.
| ** ** | ** **                             |
|------------|----------------------------------------|
| ** ** | **PARENT**                             |
| ** ** | ** **                             |
| ** ** | **DYNTEK,  INC.,**                     |
|       | a Delaware  corporation                |
|       |                                   |
|       | By:                                    | /s/ Casper Zublin, Jr. |   |
|       | Name:                                  | Casper Zublin, Jr. |
|       | Title:                                 | Chief Executive Officer |
|       |                                   |   |
| ** ** | **BUYER**                              |
| ** ** | ** **                             |
| ** ** | **DYNTEK  CANADA INC.**                |
|       | an Ontario  corporation                |
|       |                                   |
|       | By:                                    | /s/ Casper Zublin, Jr. |   |
|       | Name:                                  | Casper Zublin, Jr. |
|       | Title:                                 | President |
|       |                                   |   |
| ** ** | **SELLER**                             |
| ** ** | ** **                             |
| ** ** | **SENSIBLE  SECURITY SOLUTIONS INC.,** |
|       | an Ontario  corporation                |
|       |                                   |
|       | By:                                    | /s/ Paul Saucier |   |
|       | Name:                                  | Paul Saucier |
|       | Title:                                 | President |
|       |                                   |   |
| ** ** | **SHAREHOLDER**                        |
| ** ** | ** **                             |
| ** ** | **3849597  CANADA INC.,**              |
|       | a Canadian  corporation                |
|       |                                   |
|       | By:                                    | /s/ Paul Saucier |   |
|       | Name:                                  | Paul Saucier |
|       | Title:                                 | President |
|       |                                   |   |
|       |                                   |   |
|       |                                   | /s/ Paul Saucier |   |
| Witness    | PAUL SAUCIER                           |
|            |                                        |  |  |  |  |

 

----